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Excel Modeling in Corporate Finance, 2/E
Craig W. HoldenIndiana University

ISBN-10: 0131424270
ISBN-13:  9780131424272

Publisher:  Prentice Hall
Copyright:  2005
Format:  Paper; 208 pp
Published:  08/16/2004
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Description

For graduate courses in corporate finance.

Excel Modeling in Corporate Finance is a supplemental book and CD. It teaches students how to build financial models with step-by-step instructions in Excel. It can accompany any graduate corporate finance textbook, including textbooks by Brealey, Brigham, Keown, Ross, and Van Horne.


Features

  • NEW - Updated coverage—Adds an Annual Payments model to the Bond Valuation chapter, adds saving as a percentage of wealth to the Lifetime Financial Planning chapter, updates the yield curve database, updates the tax rates, and updates the dates in all examples.
    • Keeps text up-to-date.

  • Instructions for building financial models, not templates.
    • Students really learn finance by building financial models themselves (active learning), rather than using canned templates which are “black boxes” (passive learning).

  • Every chapter has end-of-chapter problems.
    • Provides students with the opportunity to practice what they have learned.

  • Progression from simple examples to practical, real-world applications—Including Corporate Financial Planning uses three years of historical 10K data on Nike, Inc. (including every line of their income statement, balance sheet, and cash flow statement), constructs a complete financial system (including linked financial ratios), and projects these financial statements three years into the future; Life-Cycle Financial planning that includes a detailed treatment of federal and state tax schedules, social Security taxes and benefits, etc., permitting the realistic exploration of savings, retirement, and investments choices over a lifetime; US Yield Curve Dynamics shows you a “movie” of 30 years of monthly zero-coupon, yield curves highlighting the dynamics of the US yield curve history; Three Valuation Techniques demonstrates the equivalence of the Adjusted Present Value, Flows To Equity, and the Weighted-Average Cost of Capital methods, not just in the perpetuity case, but for a fully general two-stage project.
    • Provides real-world applications that students will be excited about.

  • Can accompany any popular graduate corporate finance textbook because the CD provides alternative notation versions —The printed book matches the notation of the Brigham books (Financial Management: Theory and Practice by Brigham, Gapenski, and Erhardt and Intermediate Financial Management by Brigham, Gapenski, and Daves). The CD contains PDF files with alternative chapters that match the notation of other popular graduate corporate finance books, including:
    • Corporate Finance by Brealey and Myers

    • Financial Management by Keown, Martin, Petty, and Scott

    • Corporate Finance by Ross, Westerfield, and Jaffee

    • Financial Management and Policy by Van Horne.


Table of Contents

I. TIME VALUE OF MONEY.

1. Single Cash Flow.
Present Value. Future Value. Problems.

2. Annuity.
Present Value. Future Value. System of Four Annuity Variables. Problems.

3. Net Present Value.
Constant Discount Rate. General Discount Rate. Problems.

4. Real and Inflation.
Constant Discount Rate. General Discount Rate. Problems.

5. Loan Amortization.
Basics. Sensitivity Analysis. Problems.

II. VALUATION.

6. Bond Valuation.
Annual Payments. APR vs. EAR. By Yield to Maturity. System of Five Bond Variables. Dynamic Chart. Problems.

7. Stock Valuation.
Two Stage. Dynamic Chart. Problems.

8. The Yield Curve.
Obtaining It from Bond Listings. Using It to Price a Coupon Bond. Using It to Determine Forward Rates. Problems.

9. U.S. Yield Curve Dynamics.
Dynamic Chart. Problems.

III. CAPITAL BUDGETING.

10. Project NPV.
Basics. Forecasting Cash Flows. Working Capital. Sensitivity Analysis. Problems.

11. Cost-Reducing Project.
Basics. Sensitivity Analysis. Problems.

12. Break-Even Analysis.
Based on Accounting Profit. Based on NPV. Problems.

13 Three Valuation Methods.
Adjusted Present Value. Flows to Equity. Weighted Average Cost of Capital. Problems.

IV. FINANCIAL PLANNING.

14. Corporate Financial Planning.
Actual. Forecast. Cash Flow. Ratios. Sensitivity. Full-Scale Real Data. Problems.

15. Du Pont System of Ratio Analysis.
Basics. Problems.

16. Life-Cycle Financial Planning.
Basics. Problems.

V. OPTIONS AND CORPORATE FINANCE.

17. Binomial Option Pricing.
Single Period. Multi-Period. Risk Neutral. Full-Scale Real Data. Problems.

18. Black Scholes Option Pricing.
Basics. Dynamic Chart. Continuous Dividend. Implied Volatility. Problems.

19. Debt and Equity Valuation.
Two Methods. Impact of Risk. Problems.

20. Real Options.
Using Black-Scholes. Using the Binomial Model. Sensitivity to Standard Deviation. Problems.



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