Food Engineering (English) | |||||
Bachelor | TR-NQF-HE: Level 6 | QF-EHEA: First Cycle | EQF-LLL: Level 6 |
Course Code: | FNCE302 | ||||||||
Course Name: | Corporate Finance | ||||||||
Course Semester: | Fall | ||||||||
Course Credits: |
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Language of instruction: | EN | ||||||||
Course Requisites: | |||||||||
Does the Course Require Work Experience?: | No | ||||||||
Type of course: | Compulsory | ||||||||
Course Level: |
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Mode of Delivery: | Face to face | ||||||||
Course Coordinator : | Prof. Dr. GÖKÇE TUNÇ | ||||||||
Course Lecturer(s): |
Prof. Dr. GÖKÇE TUNÇ |
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Course Assistants: |
Course Objectives: | The objective of this course is to introduce the students to the firm theory; role of the corporation; capital structure; debt-equity mix; bond valuation; Gordon growth model and stock valuation; capital budgeting; net present value; internal rate of return; modified internal rate of return; payback rule; discounted payback rule; average accounting return; capital market history; risk and return; risk premium; systematic and unsystematic risk; diversification; security market line; cost of debt capital; cost of equity capital; weighted average cost of capital; financial leverage; dividend policy. |
Course Content: | Firm theory; role of the corporation; capital structure; debt-equity mix; bond valuation; Gordon growth model and stock valuation; capital budgeting; net present value; internal rate of return; modified internal rate of return; payback rule; discounted payback rule; average accounting return; capital market history; risk and return; risk premium; systematic and unsystematic risk; diversification; security market line; cost of debt capital; cost of equity capital; weighted average cost of capital; financial leverage; dividend policy. |
The students who have succeeded in this course;
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Week | Subject | Related Preparation |
1) | • Describe the course. • Quick Recap: Discuss the net present value (NPV) criterion • Quick Recap: Explain the payback rule • Quick Recap: Discuss the discounted payback rule • Quick Recap: Discuss Internal Rate of Return (IRR) criterion • Quick Recap: Discuss Modified-Internal Rate of Return (MIRR) criterion. • Quick Recap: Identify the reasons why the NPV criterion is the best way to evaluate proposed investments. • Syllabus. • Analyze NPV criterion • Recognize and analyze the payback rule. • Recognize and analyze the discounted payback rule • Calculate IRRs and MIRRs of different kind of investment plans. • Compare the capital budgeting techniques. | |
2) | • Determine the relevant cash flows for a proposed project. • Determine if a project is acceptable. • Identify a bid price for a project. • Evaluate the equivalent annual cost of a project. • Recognize the equivalence of various formulas, thereby removing common misunderstandings • Discuss incremental cash flow. • Discuss project cash flow. • Justify pro-forma financial statements and project cash flows. • Identify alternative cash flow definitions. • Analyze special cases of Discounted Cash Flow (DCF) analysis. | Review the Syllabus. Read, in Ross, Westerfield and Jordan (2013), chapter 10 on pages 305-342. |
3) | • Perform and interpret a sensitivity analysis for a proposed investment. • Perform and interpret a scenario analysis for a proposed investment. • Determine and interpret cash, accounting, and financial break-even points. • Evaluate how the degree of operating leverage can affect the cash flows of a project. • Identify how capital rationing affects the ability of a company to accept projects. • Recognize the need to understand the economic basis for value creation in a project. • Identify sources of value. • Explain Scenario and sensitivity “what-if” analyses. • Illustrate how to actually apply and interpret these tools in a project analysis. • Recognize cash, accounting, and financial break-even levels. • Illustrate the use of sensitivity analysis in capital budgeting. | Read, in Ross, Westerfield and Jordan (2013), chapter 11 on pages 343-373. Review the Lecture Notes. |
4) | • Calculate the return on an investment. • Recognize monetary and percentage returns. • Recognize the historical returns on various important types of investments. • Identify the stock market risk Premium. • Recognize the historical risks on various important types of investments. • Distinguish monetary returns and percentage returns. • Analyze historical average returns. • Recognizing the concept of risk premium. • Analyze the variability of returns. • Recognize historical returns in terms of normal distribution. • Calculate variances and standard deviations of historical returns. | Read, in Ross, Westerfield and Jordan (2013), chapter 12 on pages 374-411. Review the Lecture Notes. |
5) | • Discuss calculation and interpretation of geometric returns. • Evaluate common misconceptions regarding appropriate use of arithmetic vs. geometric average returns. • Discuss Blume’s Formula to make future predictions on returns. • Identify the implications of market efficiency. • Discuss the Efficient Markets Hypothesis. • Calculate and compare arithmetic and geometric returns. • Predict future rate of returns with the help of Blume’s formula. • Discuss Efficient Markets Hypothesis along with common misconceptions. • Discuss the equity premium puzzle and latest international evidence. • Discuss the stock market turmoil of 2008. | Read, in Ross, Westerfield and Jordan (2013), chapter 12 on pages 374-411. Review the Lecture Notes. |
6) | • Explain expected returns. • Explain the variance of expected returns. • Identify the portfolio of stocks and recognize its weights. • Explain the portfolio expected returns. • Explain the portfolio variance. • Calculate expected returns. • Calculate the variance of expected returns. • Calculate the portfolio expected returns. • Calculate the portfolio variance. • Compare different portfolios in terms of their expected returns and variances. | Read, in Ross, Westerfield and Jordan (2013), chapter 13 on pages 412-448. Review the Lecture Notes. |
Course Notes / Textbooks: | Stephen A. Ross & Randolph W. Westerfield & Bradford D. Jordan © 2010, 2008, 2006 , 2003 by The McGraw-Hill Companies, Inc. ISBN 0-07-738868-2 |
References: | Stephen Ross, Bradford Jordan and Randolph Westerfield McGraw-Hill Education, 10th ed., 2013 ISBN 978-0-07-803463-3 |
Learning Outcomes | 1 |
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Program Outcomes | ||||||||||||||||||||||
1) Has sufficient background in mathematics, science and engineering related fields. | ||||||||||||||||||||||
2) Uses the theoretical and practical knowledge in mathematics, science and their fields together for engineering solutions. | ||||||||||||||||||||||
3) Identifies, formulates and solves engineering problems, selects and applies appropriate analytical methods and modeling techniques for this purpose. | ||||||||||||||||||||||
4) Analyze a system, system component or process and design it under realistic constraints to meet desired requirements; apply modern design methods accordingly. | ||||||||||||||||||||||
5) Selects and uses the modern techniques and tools necessary for engineering applications. | ||||||||||||||||||||||
6) Design experiments, conduct experiments, collect data, analyze and interpret results. | ||||||||||||||||||||||
7) Works individually and in multi-disciplinary teams. | ||||||||||||||||||||||
8) Accesses information and conducts resource research for this purpose, uses databases and other information sources. | ||||||||||||||||||||||
9) Accesses information and conducts resource research for this purpose, uses databases and other information sources. | ||||||||||||||||||||||
10) Accesses information and conducts resource research for this purpose, uses databases and other information sources. | ||||||||||||||||||||||
11) Uses the theoretical and practical knowledge in mathematics, science and their fields together for engineering solutions. | ||||||||||||||||||||||
12) Identifies, formulates and solves engineering problems, selects and applies appropriate analytical methods and modeling techniques for this purpose. | ||||||||||||||||||||||
13) Analyze a system, system component or process and design it under realistic constraints to meet desired requirements; apply modern design methods accordingly. | ||||||||||||||||||||||
14) Selects and uses the modern techniques and tools necessary for engineering applications. | ||||||||||||||||||||||
15) Works individually and in multi-disciplinary teams | ||||||||||||||||||||||
16) Uses information and communication technologies together with computer software required by the field at least Advanced Level of European Computer Skills License. | ||||||||||||||||||||||
17) Communicate effectively verbally and in writing; use a foreign language at least at level B1 of the European Language Portfolio. | ||||||||||||||||||||||
18) Communicates using technical drawing. | ||||||||||||||||||||||
19) Accesses information and conducts resource research for this purpose, uses databases and other information sources. | ||||||||||||||||||||||
20) Becomes aware of the universal and social effects of engineering solutions and applications; entrepreneurship and innovation and have knowledge about the problems of the age. | ||||||||||||||||||||||
21) Has professional and ethical responsibility. | ||||||||||||||||||||||
22) Have awareness of project management, workplace practices, employee health, environmental and occupational safety; the legal consequences of engineering applications. | ||||||||||||||||||||||
23) Demonstrates awareness of the universal and social impact of engineering solutions and applications; is aware of entrepreneurship and innovation and has knowledge about the problems of the age. |
No Effect | 1 Lowest | 2 Low | 3 Average | 4 High | 5 Highest |
Program Outcomes | Level of Contribution | |
1) | Has sufficient background in mathematics, science and engineering related fields. | |
2) | Uses the theoretical and practical knowledge in mathematics, science and their fields together for engineering solutions. | |
3) | Identifies, formulates and solves engineering problems, selects and applies appropriate analytical methods and modeling techniques for this purpose. | |
4) | Analyze a system, system component or process and design it under realistic constraints to meet desired requirements; apply modern design methods accordingly. | |
5) | Selects and uses the modern techniques and tools necessary for engineering applications. | |
6) | Design experiments, conduct experiments, collect data, analyze and interpret results. | |
7) | Works individually and in multi-disciplinary teams. | |
8) | Accesses information and conducts resource research for this purpose, uses databases and other information sources. | |
9) | Accesses information and conducts resource research for this purpose, uses databases and other information sources. | |
10) | Accesses information and conducts resource research for this purpose, uses databases and other information sources. | |
11) | Uses the theoretical and practical knowledge in mathematics, science and their fields together for engineering solutions. | |
12) | Identifies, formulates and solves engineering problems, selects and applies appropriate analytical methods and modeling techniques for this purpose. | |
13) | Analyze a system, system component or process and design it under realistic constraints to meet desired requirements; apply modern design methods accordingly. | |
14) | Selects and uses the modern techniques and tools necessary for engineering applications. | |
15) | Works individually and in multi-disciplinary teams | |
16) | Uses information and communication technologies together with computer software required by the field at least Advanced Level of European Computer Skills License. | |
17) | Communicate effectively verbally and in writing; use a foreign language at least at level B1 of the European Language Portfolio. | |
18) | Communicates using technical drawing. | |
19) | Accesses information and conducts resource research for this purpose, uses databases and other information sources. | |
20) | Becomes aware of the universal and social effects of engineering solutions and applications; entrepreneurship and innovation and have knowledge about the problems of the age. | |
21) | Has professional and ethical responsibility. | |
22) | Have awareness of project management, workplace practices, employee health, environmental and occupational safety; the legal consequences of engineering applications. | |
23) | Demonstrates awareness of the universal and social impact of engineering solutions and applications; is aware of entrepreneurship and innovation and has knowledge about the problems of the age. |
Lesson |
Written Exam (Open-ended questions, multiple choice, true-false, matching, fill in the blanks, sequencing) | |
Oral Examination | |
Homework | |
Individual Project |
Semester Requirements | Number of Activities | Level of Contribution |
Midterms | 1 | % 40 |
Final | 1 | % 60 |
total | % 100 | |
PERCENTAGE OF SEMESTER WORK | % 40 | |
PERCENTAGE OF FINAL WORK | % 60 | |
total | % 100 |
Activities | Number of Activities | Workload |
Course Hours | 16 | 48 |
Study Hours Out of Class | 16 | 48 |
Project | 4 | 18 |
Homework Assignments | 6 | 12 |
Quizzes | 4 | 2 |
Midterms | 1 | 15 |
Final | 2 | 25 |
Total Workload | 168 |