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Format: 1 online resource

ISBN: 9781000024357 , 1000024350 , 9780429294976 , 0429294972 , 9781000024432 , 1000024431 , 9781000024517 , 1000024512

Content: Finance is the study of value and how it is determined. Individuals, small businesses and corporations regularly make use of value determinations for making strategic decisions that affect the future outcomes of their endeavors. The importance of accurate valuations cannot be overestimated; valuing assets too highly will lead to investing in assets whose costs are greater than their returns, while undervaluing assets will lead to missed opportunities for growth. In some situations (such as a merger or an acquisition), the outcome of the decision can make or break the investor. The need for solid financial skills has never been more pressing than in today's global economy. The Fundamental Principles of Finance offers a new and innovative approach to financial theory. The book introduces three fundamental principles of finance that flow throughout the theoretical material covered in most corporate finance textbooks. These fundamental principles are developed in their own chapter of the book, then referred to in each chapter introducing financial theory. In this way, the theory is able to be mastered at a fundamental level. The interactions among the principles are introduced through the three precepts, which help show the impact of the three principles on financial decision-making. This fresh and original approach to finance will be key reading for undergraduate students of introduction to finance, corporate finance, capital markets, financial management and related courses, as well as managers undertaking MBAs.

Note: The Fundamental Principles of Finance -- Time Value of Money -- Risk and Return -- The Term Structure of Interest Rates -- Bonds and Bond Valuation -- Stocks and Stock Valuation -- Capital Budgeting Decision Methods -- Capital Structure and the WACC -- Analyzing and Forecasting Financial Statements -- Finance Within the Firm -- Legal and Ethical Issues in Finance -- Financial Markets and Institutions.

Additional Edition: Print version: ISBN 1138477524

Additional Edition: ISBN 9781138477520

Language: English

Keywords: Electronic books. ; Electronic books.

DOI: 10.4324/9780429294976.

URL: https://www.taylorfrancis.com/books/9780429294976

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Format: 1 online resource (xi, 210 pages) : , illustrations

ISBN: 9781000024357 (e-book)

Additional Edition: Print version: Irons, Robert. Fundamental principles of finance. New York, New York ; London : Routledge, c2020 ISBN 9781138477513

Language: English

Keywords: Electronic books.

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Format: 1 online resource (225 pages)

Edition: 1st ed.

ISBN: 9781138477513 , 9781000024357

Content: The Fundamental Principles of Finance offers a new and innovative approach to financial theory. The book introduces three fundamental principles of finance that flow throughout the theoretical material covered in most corporate finance textbooks

Note: Cover -- Half Title -- Title -- Copyright -- Contents -- List of Figures -- List of Tables -- 1 The Fundamental Principles of Finance -- The Three Fundamental Principles of Finance -- The Three Precepts -- Differentiating Between the Principles and the Precepts -- Making Use of the Principles and Precepts -- Summary -- End of Chapter Problems -- 2 Time Value of Money -- The Cost of Money -- The Fundamental Principles in Action -- Understanding Why Money Has Time Value-Economic Equivalency -- Adjusting Cash Flow Values Over Time -- Future Value and Compounding -- FV of a Single Cash Flow -- FV of Uneven Cash Flows -- Present Value and Discounting -- PV of a Single Cash Flow -- Determining the Correct Exponent -- PV of Uneven Cash Flows -- Compounding/Discounting More Often Than Annually -- The Effective Annual Rate (EAR) -- The Impact of EAR on FV and PV Calculations of Single Cash Flows -- Annuities -- Future Value of an Ordinary Annuity -- Future Value of an Annuity Due -- Present Value of an Ordinary Annuity -- Present Value of an Annuity Due -- A Simple Understanding of the Annuity Due Value -- Perpetuities -- Amortized Loans -- Solving for Other Variables in the TVM Calculations -- Discrete Time vs. Continuous Time -- Summary of the Principles and Precepts Applied in This Chapter -- End of Chapter Problems -- 3 Risk and Return -- The Fundamental Principles in Action -- Measuring Return -- Annualized Return -- Average Returns -- Expected Return and Risk -- Risk and Risk Aversion -- The Relationship Between Risk and Return -- Types of Risk -- Business Risk -- The Coefficient of Variation of EBIT -- The Coefficient of Variation of the Operating Margin -- The Degree of Operating Leverage -- Financial Risk -- The Coefficient of Variation of Net Income -- The Coefficient of Variation of the Net Margin -- The Degree of Financial Leverage , Common Size Analysis and Percent Change Analysis -- Forecasting Financial Statements-The Percent of Sales Method -- Forecasting the Income Statement -- Forecasting the Balance Sheet -- Analyzing the Pro Forma Statements -- Summary -- End of Chapter Problems -- Comprehensive Excel Problem -- 10 Finance Within the Firm -- The Role of Finance -- Finance Is a Strategic Discipline -- The Intrinsic Value of the Firm -- Corporate Sustainability -- How to Maximize the Intrinsic Stock Price -- Types of Financial Decisions -- The Importance of Finance -- Careers in Finance -- Investments and Wealth Management -- Financial Markets and Institutions -- Financial Management -- Forms of Business Organization -- Proprietorship -- Partnership -- Corporation -- The Secret to a Successful Business -- Summary -- End of Chapter Problems -- 11 Legal and Ethical Issues in Finance -- Financial and Accounting Scandals -- WorldCom -- Enron -- Towers Financial -- Adelphia Communications -- Bayou Hedge Fund -- Refco -- Madoff Investment Securities -- Lessons From Financial Scandals -- Misusing Risk -- Lincoln Savings and Loan -- Proctor andamp -- Gamble and Bankers Trust -- Orange County, California -- Barings Bank -- Long Term Capital Management -- Lessons From Misusing Risk -- The 2008 Financial Crisis -- Agency Issues -- Summary -- End of Chapter Problems -- 12 Financial Markets and Institutions -- Financial Markets -- Primary Markets -- Secondary Markets -- Money Market -- Capital Market -- The Efficient Market Hypothesis -- Beating the Market -- The Three Levels of Market Efficiency -- Weak Form Efficiency -- Semi-Strong Form Efficiency -- Strong Form Efficiency -- A Way to View Market Efficiency -- Forces That Determine Market Efficiency -- Institutional Investors -- Financial Securities -- Money Market Securities -- Capital Market Securities -- Equity -- Debt , Degree of Combined Leverage -- Portfolio Risk -- Measuring Portfolio Risk -- Beta -- Portfolio Risk and Return -- Relevant Risk and Required Return-The CAPM -- Summary of the Principles and Precepts Applied in This Chapter -- End of Chapter Problems -- Excel Project -- 4 The Term Structure of Interest Rates -- The Fundamental Principles in Action -- Real vs. Nominal Interest Rates-The Effects of Inflation -- The Determinants of Interest Rates -- The Default Risk Premium -- The Liquidity Risk Premium -- The Maturity Risk Premium -- Determining Interest Rates -- The Yield Curve -- Bond Yields vs. Stock Returns-The Fed Model -- Summary of the Principles and Precepts Applied in This Chapter -- End of Chapter Problems -- 5 Bonds and Bond Valuation -- The Fundamental Principles in Action -- The Basics of Bonds -- Calculating the Value of a Bond -- Bond Values Over Time -- Using Excel to Calculate Bond Prices -- Calculating a Bond's Yield to Maturity -- Calculating a Bond's Yield to Call -- Duration and Its Use -- Summary of the Principles and Precepts Applied in This Chapter -- End of Chapter Problems -- 6 Stocks and Stock Valuation -- The Fundamental Principles in Action -- The Basics of Stocks -- The Dividend Discount Model -- Preferred Stock Valuation -- Common Stock Valuation With Dividends-Constant Growth -- Common Stock Valuation With Dividends-Non-Constant Growth -- Common Stock Valuation Without Dividends-The Cash Flow From Assets Model -- Understanding Operating Accounts -- Calculating Cash Flow From Assets -- Using the Cash Flow From Assets Model to Value a Firm's Common Equity -- Summary of the Principles and Precepts Applied in This Chapter -- End of Chapter Problems -- 7 Capital Budgeting Decision Methods -- The Fundamental Principles in Action -- The Capital Budgeting Decision Methods -- The Payback Period -- The Discounted Payback Period , The Net Present Value -- The Internal Rate of Return -- Comparing the NPV and IRR Methods -- The Modified Internal Rate of Return -- Evaluating Capital Budgeting Projects -- Cash Flow Estimation -- Relevant Cash Flows -- Changes in Net Working Capital -- Evaluating Capital Budgeting Projects -- Initial Cash Flows -- Operating Cash Flows -- Terminal Cash Flows -- Net Operating Cash Flow -- Paying Attention to Details -- The Truth of PR2 -- Adjusting for Risk in the Capital Budgeting Analysis Process -- The Investment Opportunity Schedule -- Summary of the Principles and Precepts Applied in This Chapter -- End of Chapter Problems -- Excel Project -- Replacement Project Analysis -- 8 Capital Structure and the WACC -- The Fundamental Principles in Action -- Understanding Capital Structure and Its Effects -- The Component Costs of Capital -- The After-Tax Cost of Debt -- The Cost of Preferred Equity -- The Cost of Internal Common Equity -- The CAPM Approach -- The DDM Approach -- The Cost of External Common Equity -- Determining the Weights for the Component Costs -- Putting It All Together -- Summary of the Principles and Precepts Applied in This Chapter -- End of Chapter Problems -- Comprehensive Excel Problem -- 9 Analyzing and Forecasting Financial Statements -- Understanding the Financial Statements -- The Balance Sheet -- Current Assets -- Long-Term Assets -- Current Liabilities -- Long-Term Liabilities -- Equity -- The Income Statement -- The Statement of Cash Flows -- Statement of Retained Earnings -- Analyzing the Financial Statements -- Liquidity Ratios -- Asset Management Ratios -- Debt Management Ratios -- Profitability Ratios -- Market Value Ratios -- Value and Growth Metrics -- The Du Pont Equation -- Trend Analysis, Benchmarking, Common Size Analysis and Percent Change Analysis -- Benchmarking , Treasury Bonds -- Municipal Bonds -- Corporate Bonds -- Mutual Funds -- Derivative Securities -- Options -- Financial Institutions -- The Federal Reserve System -- Commercial Banks -- Savings and Loan Associations -- Credit Unions -- Finance Companies -- Insurance Companies -- Retirement Plans -- Summary -- End of Chapter Problems -- Index

Additional Edition: Print version Irons, Robert The Fundamental Principles of Finance Oxford : Taylor & Francis Group,c2019 ISBN 9781138477513

Language: English

Keywords: Electronic books

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