Principles of corporate finance

Contents:
Preface;
Part One: Value;
1 Introduction to Corporate Finance;
1-1 Corporate Investment and Financing Decisions;
Investment Decisions;
Financing Decisions;
What Is a Corporation;
The Role of the Financial Manager;
1-2 The Financial Goal of the Corporation;
Shareholders Want Managers to Maximize Market Value;
A Fundamental Result;
The Investment Trade-off;
Should Managers Look After the Interests of Their Shareholders;
Agency Problems and Corporate Governance;
1-3 Preview of Coming Attractions;
Summary;
Problem Sets Appendix: Why Maximizing Shareholder Value Makes Sense;
2 How to Calculate Present Values;
2-1 Future Values and Present Values;
Calculating Future Values;
Calculating Present Values;
Valuing an Investment Opportunity;
Net Present Value;
Risk and Present Value;
Present Values and Rates of Return;
Calculating Present Values When There Are Multiple Cash Flows;
The Opportunity Cost of Capital;
2-2 Looking for Shortcuts-Perpetuities and Annuities;
How to Value Perpetuities;
How to Value Annuities;
Valuing Annuities Due;
Calculating Annual Payments Future Value of an Annuity;
2-3 More Shortcuts-Growing Perpetuities and Annuities;
Growing Perpetuities;
Growing Annuities;
2-4 How Interest Is Paid and Quoted;
Continuous Compounding;
Summary;
Problem Sets;
Finance on the Web;
3 Valuing Bonds;
3-1 Using the Present Value Formula to Value Bonds;
A Short Trip to Paris to Value a Government Bond;
Back to the United States: Semiannual Coupons and Bond Prices;
3-2 How Bond Prices Vary with Interest Rates;
Duration and Volatility;
3-3 The Term Structure of Interest Rates Spot Rates, Bond Prices, and the Law of One Price;
Measuring the Term Structure;
Why the Discount Factor Declines as Futurity Increases-and a Digression on Money Machines;
3-4 Explaining the Term Structure;
Expectations Theory of the Term Structure;
Introducing Risk;
Inflation and Term Structure;
3-5 Real and Nominal Rates of Interest;
Indexed Bonds and the Real Rate of Interest;
What Determines the Real Rate of Interest;
Inflation and Nominal Interest Rates;
3-6 The Risk of Default;
Corporate Bonds and Default Risk;
Sovereign Bonds and Default Risk;
Summary Further Reading;
Problem Sets;
Finance on the Web;
4 The Value of Common Stocks;
4-1 How Common Stocks Are Traded;
Trading Results for GE;
4-2 How Common Stocks Are Valued;
Valuation by Comparables;
Stock Prices and Dividends;
4-3 Estimating the Cost of Equity Capital;
Using the DCF Model to Set Gas and Electricity Prices;
Dangers Lurk in Constant-Growth Formulas;
4-4 The Link Between Stock Price and Earnings per Share;
Calculating the Present Value of Growth Opportunities for Fledgling Electronics;
4-5 Valuing a Business by Discounted Cash Flow