Concepts of managerial finance
- The chapters included here deal with the essential concepts of managerial finance and focusses on crucial concepts and definitions in the field. Some of the ideas discussed here are risk-return, corporate stock valuations, and financial applications. The chapters have also covered options in the area of corporate finance. Chapter 6 deals with investment return concepts. The subtopics include the Basic return and risk concepts such as Stand-alone risk, portfolio (market) risk, and return CAPM/SML, market equilibrium, and market efficiency. Chapter 7 covers the topics included in corporate and stock valuation. The topics further included in this are features and valuing of common stock, preferred stock, classified stock, tracking stock. The final chapter, chapter 8, mainly deals with the concept of financial options and its applications in corporate finance systems. The topics included in the chapter are financial options terminology, option price relationships, Black-Scholes option pricing model, put-call parity
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- The sections discussed here focus on the concepts of managerial finance and discuss essential ideas related to it, along with a few fundamental definitions. Chapter 6 covers risk and return concepts, and the topics included are essential return and risk concepts, stand-alone, and portfolio (market) risk, CAPM/SML. Market equilibrium and market efficiency have also been covered under the chapter. Chapter 7 includes the concepts of common stock and preferred stock. Valuing common stock can be done by three methods: Free cash flow models, market multiplies, and dividend growth models. Chapter 8 includes financial options, and topics associated with it, such as put option, call option, expiry date, strike price, and others. The applications of financial options in corporate finances have been covered along with topics such as financial options terminology, option price relationships, the Black-Scholes option pricing model, and put-call parity. The impact of strike price and stock price on the call option value has also been discussed.