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					                           BMGT 340 Business Finance
                        The Robert H Smith School of Business
                              University of Maryland
                                   Summer I 2005

Instructor:            Mark Taranto

Lecture:               MW 6:40-10:00          1505 Van Munching Hall
       SHDH 209
                       Section 008 MW 1:30-2:50            JMHH F55
                       Section 009 MW 3:00-4:30            JMHH F55
Office hours:          Tuesdays 1:00-2:30, Fridays 1:30-2:30 and by appointment.
Office:                2439 SH-DH, (215) 898-7617
Email:                 mtaranto@rhsmith.umd.edu

Text: Fundamentals of Financial Management 10th Ed.
      Brigham & Houston. Thomson South-Western, 2004.

Web Page: http://bb.rhsmith.umd.edu/

        A web page on BlackBoard will be used for class announcements. In addition,
copies of the Powerpoint slides and assignments will also be made available. These are
not to be shared with students not taking the class.

Course Description

        Business Finance is intended to be the first finance class and is an introduction to
the basic concepts of finance. It introduces concepts and securities that are studied in
higher-level classes. Despite the name, the class will include a discussion of topics in
Capital Markets as well as an introduction to Corporate Finance.
        Financial instruments (e.g., bonds, stocks, options, futures contracts) will be
studied, concentrating on the following questions: What are they? What are the
rewards? What are the risks? How are they priced?
        In the latter part of the class, these concepts will be used to show how Finance is
used in a corporate setting. In particular, we will discuss how to price risky corporate
projects, the determinants of corporate capital structure (how companies raise cash) and
dividend policy.
                          BMGT 340 Business Finance
                       The Robert H Smith School of Business
                             University of Maryland
                                  Summer I 2005

Course Mechanics

        There will be one mid-term exam (45%) and a final exam (55%). The final exam
will be inclusive with about 60-65% of the exam on new material. There will be no grade
given for class participation. However, students are encouraged to ask questions, and to
participate. Class participation may be used to determine the grades of students whose
test scores place them on the margin between grades.
        Homework problems will be assigned, but will not be collected. While it would
be easy to shirk your responsibility in doing the homework, it is not advised. Ability to
complete the homework translates directly into ability to do well on the tests. Solutions
will be provided a few days after the assignment is made available.

Class Sessions -- Be on time

Exams

        The midterm exam will be held during the June 22 class period and will last two
hours. The final exam will be held during the scheduled exam period. The Final Exam
Schedule is not yet availableAll exams will be closed-book exams. Calculators will be
needed during the exams. Some formulas will be provided to help you. If you have a
conflict with an exam, let me know as soon as possible.

Makeup Exam

       A makeup exam will be scheduled as soon as possible after the missed exam, and
will only be available to those who have a valid excuse due to documented illness or
emergency. The makeup exams will not be easier than the original exam. Please make
every effort to make the original exam.

Regrading Policy

       Regrading requests must be made in writing within one week of receiving the
graded material. When regrading is requested, the entire exam will be regraded. If the
points on an exam were not added correctly, then the student may make the request in
person and need not submit the request in writing.
                          BMGT 340 Business Finance
                       The Robert H Smith School of Business
                             University of Maryland
                                  Summer I 2005

Academic Integrity

    Students may not submit work that is not their own. If a student submits work that
has been copied without attribution from some published or unpublished source, or that
has been prepared by someone else, or that in any way misrepresents someone else's
work as his own, he will face severe discipline by the university.


Topics

The following table shows the topics that will be discussed. The topics are subject to
change – though I will attempt to stick to this schedule. Lectures will not follow the
order of the textbook, but are put in an order that I feel is most logical. Lecture notes
(Powerpoint Slides) will be placed on Blackboard before each class. Suggested readings
from the textbook will be provided during the first class.


Date                       Topic
June 1, 2005               Introduction, Time value of money
                           Bond Market
June 6, 2005               Bond pricing and dynamics
June 8, 2005               Term Structure of Interest Rates
                           Stock Market & Equity Valuation Part I
June 13, 2005              Stock Market & Equity Valuation Part II
                           Portfolio Analysis & Diversification Part I
June 15, 2005              Portfolio Analysis & Diversification Part II
                           Capital Asset Pricing Model
June 20, 2005              CAPM Part II
                           Efficient Markets
                           Review
June 22, 2005              Midterm Exam
June 27, 2005              Project Evaluation, NPV Rule & Capital Budgeting
                           CAPM In Corporate Environment
June 29, 2005              Capital Structure & Raising Capital
                           Forward & Futures Contracts
July 4, 2005               Independence Day. No Class
July 6, 2005               Derivative Securities and Option Pricing
                           Review
TBA                        Final Exam

				
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