UNIVERSITY OF MASSACHUSSETS DARTMOUTH
College of Business
Department of Accounting and Finance
COURSE: Business Finance, FIN 312-Section 02, TR 11:00-12:15 pm
Class location: Dion 116
PREREQUISITES: ACT 312, ECO 231, and at least junior standing
INSTRUCTOR: Duong Nguyen, Ph.D.
Room 220, College of Business
(508) 999 – 8070
OFFICE HOURS: Monday 11:00-12:00 and 1:30-4:30
Wednesday 11:00-12:00 and 1:30-4:30
and also by appointment
An introduction to the nature of financial management. The course presents the basic tools used
in the decision-making process as they pertain to the acquisition, management, and financing
current and long-term assets. Working capital policies, the time value of money, capital
budgeting, and debt and equity financing are discussed.
Explain and evaluate the concept of shareholder wealth maximization and how it relates
to other possible objectives of the firm's management as well as the nature of the agency
relationship inherent in the corporate structure.
Explain the concepts of compounding and discounting and utilize these tools to calculate
the future value and present value of lump sums, annuities, and uneven cash flow streams
and in addition calculate the value of other variables such as the interest rate, time period,
and periodic payment.
Determine the expected rate of return and risk of an individual investment as well as a
portfolio of assets, including concepts such as standard deviation, correlation,
diversification, and the CAPM (Capital Asset Pricing Model).
Explain the determinants of intrinsic value and utilize these concepts to determine the
value and yields of bonds and preferred and common stocks.
Calculate various measures of project profitability using traditional capital budgeting
techniques including Payback Period, Net Present Value, Internal Rate of Return, and
Modified Internal Rate of Return.
Explain the concept of the cost of capital and how it is affected by the firm’s capital
structure and the application of these concepts to capital budgeting decision-making and
Understand the significance of information included in the income statement and balance
sheet, discuss the importance of the cash flow statement and explain the difference
between accounting net income for the firm and cash flow; analyze a firm's financial
performance using financial ratio analysis.
COMPETENCIES AND CONTACT HOURS
The student will be introduced to:
Overview and Financial Management 1.5
Ethical issues in Financial Management 1.5
The student will understand:
Balance sheet and Income statement. Understanding financial statements 6
The time value of money 6
Valuation of bonds 5
Valuation of commons stocks and preferred stocks 5
Risk and return tradeoff 5
Long-term investment decision of corporation 2
Net present value principle and other techniques of capital budgeting 5
Weighted average cost of capital 5
Students will be able to apply the skills learned in this class to real life financial
problems. Also this course provides a background to learn advanced level of finance in the areas
of investments, international finance, financial institutions, valuation of derivatives and other
TEXTBOOK AND REQUIRED MATERIALS
Fundamentals of Corporate Finance, 8th edition by Ross, Westerfield, and Jordan. A
customized version of this book for the use at Umass Dartmouth is available in the bookstore.
Recommended Reading: The Wall Street Journal, Business Week, and other financial
periodicals and journals.
Financial Calculator: BA II Plus (recommended)
Financial calculator is a must in this class. You will not be able to do the assignment or the
exam without one. I strongly recommend all of you get familiar with the calculator by
reading the manuals posted on website.
Regular attendance and participation is essential for success. All assigned material should be
carefully read and end-of-chapter exercises should be attempted before each class meeting.
If you miss any material, it is your responsibility to obtain the information from another
Do not consistently arrive late or leave early. If you have to leave or enter the room while a
discussion or presentation is in progress, be quiet and discreet. A continued absence or
several absences will adversely impact your grade.
Do not conduct private conversations while class is in session. However, participation in
class discussions is expected.
TENTATIVE COURSE SCHEDULE
Meeting Topic Chapter Quizzes and Chapter exercises
01/29/08 Class Introduction
Introduction to corporate finance 1
01/31/08 Financial Statements, Taxes, and cash 2
02/05/08 Financial Statements, Taxes, and cash 2 Q 1: 20
02/07/08 Time value of money 5 Quiz 1
02/12/08 Time value of money 5 Q: 1-19
02/14/08 Discounted cash flow valuation 6 Quiz 2
02/19/08 Follow Monday Schedule (no class)
02/21/08 Discounted cash flow valuation 6 1-22
02/26/08 Wrap up and Review Assignment 1 due
02/28/08 Interest rates and bond valuation 7
03/04/08 Exam 1 1,2,5,6
03/06/08 Interest rates and bond valuation 7 1-27
03/11/08 Stock valuation 8 Quiz 3
03/13/08 Stock valuation 8 1-21
03/18/08 Spring break (no class)
03/20/08 Spring break (no class)
03/25/08 NPV and other investment criteria 9
03/27/08 NPV and other investment criteria 9 1-17
04/01/08 Making capital investment decisions 10
04/03/08 Wrap up and Review Quiz 4
Assignment 2 due
04/08/08 Exam 2 7,8,9,10
04/10/08 Lessons from Capital Market History 12
04/15/08 Lessons from Capital Market History 12 1-16
04/17/08 Risk, return, and security market line 13 Quiz 5
04/22/08 Risk, return, and security market line 13 1-23
04/24/08 Cost of capital 15
04/29/08 Cost of capital 15 Q: 1-15
05/01/08 Options and corporate finance 14
05/06/08 Options and corporate finance 14 1-12
05/08/08 International corporate finance 22
05/13/08 Wrap up and Review Quiz 6
Assignment 3 due
calendar Exam 3 12,
EXAMS, QUIZZES, ASSIGMENTS, AND GRADES
There will be three exams. They are both multiple choices and problem questions. The exams are
not comprehensive, although some material will carry through.
There is no point for end-of chapter exercises. However, it is recommended that all of you should
do them for better understanding about the class materials and for preparation of the exams. The
solutions for the homework are posted on Website.
There will be 6 quizzes throughout the semester. Only your 4 highest score quizzes are counted
toward your final grade. You can drop your 2 lowest score quizzes. Check the syllabus for quiz
dates. Quizzes typically have 7 or 8 questions, you will have about 10-15 minutes to complete
There will be 3 assignments. The assignments will be posted on Website. Check the syllabus for
assignment due dates. You can either do them on your own or work in a group of no more than 2
people. Late assignments will not be graded.
Attendance will count 5% in your total grade. To have this 5%, you should not miss more than 3
Exam 1: 25%
Exam 2: 25%
Exam 3: 25%
Quizzes: 8% (4 quizzes, 2% each)
Assignments 12% (3 assignments, 4% each)
Total : 100%
The distribution grade for attendance as follows
Attendance grade No. of meetings missed
Your grade will be based on the following schedule
A+ (97-100); A (91-96); A- (88-90);
B+ (82-87); B (73-81); B- (70-72);
C+ (66-69); C (61-65); C- (58-60);
D+ (52-57); D (50-54); F (0-49)
Absolutely no incomplete grades or make-up examinations will be given unless a medical or
personal EMERGENCY precludes the completion of the exam. Students who are eligible
for makeup need to finish the makeup within 48 hours of the scheduled time. Otherwise,
missing an exam on the scheduled date will automatically earn a zero score.
If a student has a disability and needs assistance, please notify the Instructor and contact the
Office of Disability Services for Students to make arrangements for the appropriate modification
Any student may request to be excused from a scheduled exam to observe a religious holy day of
their faith. The student must notify the instructor and arrange to take the exam in advance of the
regularly scheduled exam date.
Cell phones and beepers are to be turned off or set to “silent mode” during class and exams.
The last day to drop the course with a grade of “DR” or “WI” is: Check school calendar.
POLICIES FOR ALL EXAMINATION – READ CAREFULLY
All examinations will start at the scheduled time.
Exams are to be completed individually. You are not to discuss any question with any
Make sure that your calculator works and you have extra batteries available. A non-
working calculator will be no excuse for a make-up test.
You may be asked to produce a photo ID during the examination.
Bring at least two sharpened No. 2 pencils.
Students are permitted the use of a calculator and a formula sheet.
Tests will typically consist of multiple choices and problem solving questions.
You must hand in the examination, answer sheet and formula sheet at the end of the
If you do not hand in your examination before the scheduled end time, one point will be
deducted for every extra minute. Ten minutes after the end time, I will assume you have
not taken the test and get a score of zero.
Every student must respect the right of all to have an equitable opportunity to learn and honestly
demonstrate the quality of their learning. Therefore, all students must adhere to a standard of
academic conduct, demonstrating respect for themselves, their fellow students, and the
educational mission of the University. As a student in the College of Business taking this class:
I will not represent someone else’s work as my own
I will not cheat, nor will I aid in another’s cheating
I will be honest in my academic endeavors
I understand that if I am found responsible for academic misconduct, I will be subject to
the academic misconduct procedures and sanctions as outlined in the Student Handbook
Failure to adhere to the guidelines stated above may result in one of the followings:
Expulsion: Permanent separation of the students from the University, preventing
readmission to the institution. This sanction shall be recorded on the student transcript
Suspension: Temporary separation of the student from the University for a specific
period of time
By taking this class, I promise to adhere to UMass Darthmouth Student Code of Academic
Integrity. For details on the policy and procedure, please check the Student Handbook.