Principles of corporate finance:
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| Main Authors: | , |
|---|---|
| Format: | Book |
| Language: | English |
| Published: |
New York u.a.
McGraw-Hill
1991
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| Edition: | 4. ed. |
| Series: | McGraw-Hill series in finance
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| Subjects: | |
| Links: | http://bvbr.bib-bvb.de:8991/F?func=service&doc_library=BVB01&local_base=BVB01&doc_number=004601546&sequence=000002&line_number=0001&func_code=DB_RECORDS&service_type=MEDIA |
| Physical Description: | Getr. Zählung graph. Darst. |
| ISBN: | 0070074054 0071007563 |
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| 245 | 1 | 0 | |a Principles of corporate finance |c Richard A. Brealey ; Stewart C. Myers |
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| adam_text | Titel: Principles of corporate finance
Autor: Brealey, Richard A
Jahr: 1991
CONTENTS
Preface xxv
PART ONE VALUE
Chapter 1 Why Finance Matters 3
1 -1 The Role of the Financial Manager 3
Understanding value I Time and uncertainty I Financial objectives in complex
organizations I Understanding the value of information.
1 -2 Who is the Financial Manager? 6
1-3 Topics Covered in This Book 7
1 -4 Summary 9
Quiz 9
Chapter 2 Present Value and the Opportunity Cost of Capital 11
2-1 Introduction to Present Value 12
Calculating present value / Net present value / A comment on risk and present
value J Present values and rates of return
2-2 Foundations of the Net Present Value Rule 15
How the capital market helps to smooth consumption patterns / Now we introduce
productive opportunities / A crucial assumption / Imperfect capital markets
2-3 A Fundamental Result 22
Other corporate goals
2-4 Summary 23
Further Reading 24
Quiz 24
Questions and Problems 26
Chapter 3 How to Calculate Present Values 29
3-1 Valuing Long-Lived Assets 29
Valuing cashflows in several periods j Why the discount factor declines
as futurity increases-And a digression on money machines / How present value
tables help the lazy
: Contents
3-2 Looking for Shortcuts-Perpetuities and Annuities 22
How to value growing perpetuities / How to value annuities
3-3 Compound Interest and Present Values 36
A note on compounding intervals
3-4 Summary 40
Further Reading 42
Quiz 42
Questions and Problems 43
Chapter 4 Present Value of Bonds and Stocks 47
4-1 A Quick Look at How Bonds Are Valued 47
4-2 How Common Stocks Are Valued 49
Today s price / But what determines next year s price?
4-3 A Simple Way to Estimate the Capitalization Rate 52
Using the DCF model to set electricity prices / Some warnings about
constant-growth formulas
4-4 The Link between Stock Price and Earnings per Share 56
Calculating the present value of growth opportunities for Fledging Electronics / A
general expression linking dividends and growth opportunities / What do price-
earnings ratio mean? / What do earnings mean?
4-5 Summary 61
Appendix: Valuing a Business by Discounted Cash Flow 63
Forecasting free cash flow for a business / Valuation format / Estimating horizon
value I A further reality check / Conclusion
Further Reading 67
Quiz 67
Questions and Problems 68
Chapter 5 Why Net Present Value Leads to Better Investment
Decisions than Other Criteria 73
5-1 A Review of the Basics 73
5-2 Net Present Value s Competitors 75
5-3 Payback 75
The payback rule / Discounted payback
5-4 Average Return on Book Value 77
5-5 Internal (or Discounted Cash Flow) Rate of Return 79
Pitfall 1-Lending or borrowing? / Pitfall 2-Multiple rates of return / Pitfall 3-
Mutually exclusive projects / Pitfall 4-What happens when we can t finesse the
term structure of interest rates? / The verdict on IRR
5-6 Profitability Index or Benefit-Cost Ratio 88
5-7 Summary 89
Further Reading 90
Quiz 90
Questions and Problems 92
Contents xi
Chapter 6 Making Investment Decisions with the Net Present Value Rule 95
6-1 What to Discount 95
Only cash flow is relevant / Estimate cash flows on an incremental basis / Treat
inflation consistently
6-2 Example-IM C Project 100
Separating investment and financing decisions / A further note on estimating cash
flow I A further note on depreciation / A final comment on taxes / A final comment
on project analysis
6-3 Project Interactions 107
Case 1-Optimal timing of investment / Case 2-Choosing between long- and short-
lived equipment / Case 3-Deciding when to replace an existing machine / Case 4-
Cost of excess capacity / Case 5-Fluctuating load factors
6-4 Choosing the Capital Expenditure Program when Resources Are Limited 113
Profitability index under capital rationing / Some more elaborate capital rationing
models / Uses of capital rationing models
6-5 Summary 117
Appendix: Some Embellishments to the Capital Rationing Model 118
Cash carry-forward I Mutually exclusive projects I Contingent projects I Constraints
on nonfinancial resources I Constraints on nonfinancial output
Further Reading 119
Quiz 119
Questions and Problems 120
PART TWO RISK
Chapter 7 Introduction to Risk, Return, and the Opportunity
Cost of Capital 129
7-1 Sixty-Three Years of Capital Market History in One Easy Lesson 129
Using historical evidence to evaluate today s cost of capital
7-2 Measuring Portfolio Risk 131
Variance and standard deviation / Measuring variability / How diversification
reduces risk
7-3 Calculating Portfolio Risk 139
General formula for computing portfolio risk / Limits to diversification
7-4 How Individual Securities Affect Portfolio Risk 143
Market risk is measured by beta / Why security betas determine portfolio risk
7-5 Diversification and Value Additivity 148
7-6 Summary 149
Further Reading 150
Quiz 150
Questions and Problems 152
Chapter 8 Risk and Return 155
8-1 Harry Markowitz and the Birth of Portfolio Theory 155
Combining stocks into portfolios / We introduce borrowing and lending
xii Contents
8-2 The Relationship between Risk and Return 161
Some estimates of expected returns / A proof of the capital asset pricing model /
What would happen if a stock did not lie on the security market line?
8-3 Validity and Role of the Capital Asset Pricing Model 165
Tests of the capital asset pricing model / Assumptions behind the capital asset
pricing model
8-4 Some Alternative Theories 168
Consumption betas versus market betas / Arbitrage pricing theory / A comparison of
the capital asset pricing model and arbitrage pricing theory
8-5 Summary 173
Further Reading 174
Quiz 175
Questions and Problems 177
Chapter 9 Capital Budgeting and Risk 181
9-1 Measuring Betas 183
Stability of betas over time / Using a beta book / Industry betas and the divisional
cost of capital
9-2 Capital Structure and the Company Cost of Capital 189
How changing capital structure affects expected returns / How changing capital
structure affects beta / A word of caution and a few observations
9-3 How to Estimate Carolina Power and Light s Cost of Capital-An Example 193
The expected return on Carolina P L s common stock / Estimating Carolina P L s
company cost of capital
9-4 Setting Discount Rates When You Can t Use a Beta Book 196
Avoiding fudge factors in discount rates / What determines asset betas? / Searching
for clues
9-5 Another Look at Discounted Risk and Cash Flow 201
Valuing certainty-equivalent flows / When you cannot use a single risk-adjusted
discount rate for long-lived assets / A common mistake
9-6 Summary 205
Appendix: Using the Capital Asset Pricing Model to Calculate
Certainty Equivalents 206
Further Reading 208
Quiz 208
Questions and Problems 209
PART THREE PRACTICAL PROBLEMS IN CAPITAL BUDGETING
Chapter 10 A Project Is Not a Black Box 215
10-1 Sensitivity Analysis 215
Value of information / Limits to sensitivity analysis / Examining the project under
different scenarios / Break-even analysis
10-2 Monte Carlo Simulation 223
Simulating the electric car project / Assessing simulation: You pay for what you
get I Misusing simulation
Contents xiii
10-3 Decision Trees and Subsequent Decisions 229
An example: Vegetron / A tougher example: Magna Charter j Bailing out /
Abandonment value and capital budgeting / Pro and con decision trees I Decision
trees and Monte Carlo simulation
10-4 Summary 237
Further Reading 238
Quiz 239
Questions and Problems 240
Chapter 11 Where Positive Net Present Values Come From 243
11-1 Look First to Market Values 243
The Cadillac and the movie star / Example: Investing in a new department store /
Another example: Opening a gold mine
11 -2 Forecasting Economic Rents 247
11-3 Example-Marvin Enterprises Decides to Exploit a New Technology 248
Forecasting prices of gargle blasters / The value of Marvin s new expansion /
Alternative expansion plans / The value of Marvin stock / The lessons of
Marvin Enterprises
11-4 Summary 245
Further Reading 256
Quiz 256
Questions and Problems 257
Chapter 12 Organizing Capital Expenditure and Evaluating
Performance Afterward 261
12-1 Capital Budgets and Project Authorizations 261
Project authorizations / The decision criteria firms actually use / Controlling capital
investment decisions
12-2 Problems and Some Solutions 265
Ensuring that forecasts are consistent / Eliminating conflicts of interest / Reducing
forecast bias / Getting senior management the information that it needs /
Recognizing strategic fit
12-3 Evaluating Performance 268
Controlling projects in progress / Postaudits / Problems in measuring incremental
cash flows after the fact / Evaluating operating performance / Accounting rate of
return as a performance measure
12-4 Example-Measuring the Profitability of the Nodhead Supermarket 271
Book earnings versus true earnings / Does ROI give the right answer in the
long run?
12-5 What Can We Do about Biases in Accounting Profitability Measures? 275
Do managers worry unduly about book profitability?
12-6 Summary 277
Further Reading 278
Quiz 279
Questions and Problems 279
xiv Contents
PART FOUR FINANCING DECISIONS AND MARKET EFFICIENCY
Chapter 13 Corporate Financing and the Six Lessons of Market Efficiency 287
13-1 We Always Come Back to NPV 288
Differences between investment and financing decisions / Efficient capital markets
13-2 What Is an Efficient Market? 290
A startling discovery: Price changes are random / A theory to fit the facts / Three
forms of the efficient-market theory / No theory is perfect / The crash of 1987
13-3 The First Lesson of Market Efficiency: Markets Have No Memory 300
13-4 The Second Lesson of Market Efficiency: Trust Market Prices 300
Example: Northwestern Bell s bond repurchase offer
13-5 The Third Lesson of Market Efficiency: There Are No Financial Illusions 302
Stock splits and dividends / Calculating abnormal returns / Accounting changes
13-6 The Fourth Lesson of Market Efficiency: The Do-It-Yourself Alternative 307
13-7 The Fifth Lesson of Market Efficiency: Seen One Stock, Seen Them All 307
1 3-8 The Sixth Lesson of Market Efficiency: Reading the Entrails 309
13-9 Summary 309
Further Reading 310
Quiz 310
Questions and Problems 312
Chapter 14 An Overview of Corporate Financing 315
14-1 Common Stock 315
Definitions / Stockholders rights
14-2 A First Look at Corporate Debt 318
Debt comes in many forms / A debt by any other name
14-3 Preferred Stock 320
14-4 Convertible Securities 321
14-5 Variety s the Very Spice of Life 322
The process of innovation
14-6 Patterns of Corporate Financing 324
Do firms rely too heavily on internal funds? / Timing debt and equity issues / The
dilution fallacy / Has capital structure changed? / Market-value debt ratios
14-7 Summary 334
Further Reading 335
Quiz 336
Questions and Problems 337
Chapter 15 How Corporations Issue Securities 339
15-1 Venture Capital 339
1 5-2 The Initial Public Offering 343
Arranging a public issue / Pricing a new issue / Costs of a public issue
15-3 General Cash Offers by Public Companies 346
General cash offers and shelf registration / International security issues / The costs
of the general cash offer / Market reaction to stock issues
Contents xv
1 5-4 The Role of the Underwriter 350
Who are the underwriters? / Choosing an underwriter
15-5 The Private Placement 354
15-6 Summary 356
Appendix A: The Privileged Subscription or Rights Issue 357
How rights issues work / How a rights issue affects the stock price / Issue price
is irrelevant as long as the rights are exercised / The choice between the cash
offer and the rights issue
Appendix B: Marvin s New Issue Prospectus 361
Further Reading 365
Quiz 366
Questions and Problems 367
PART FIVE DIVIDEND POLICY AND CAPITAL STRUCTURE
Chapter 16 The Dividend Controversy 371
16-1 How Dividends Are Paid 372
Some legal limitations on dividends / Dividends come in many forms / Share
repurchase
16-2 How Do Companies Decide on Dividend Payments? 374
Lintner s model / The information content of dividends
16-3 Controversy about Dividend Policy 376
Dividend policy is irrelevant in perfect capital markets / Dividend irrelevance-An
illustration / Calculating share price / Share repurchase
16-4 The Rightists 380
Do MM ignore risk? / Market imperfections
16-5 Taxes and the Radical Left 383
How taxes affect values / Why pay any dividends at all? / Empirical evidence on
dividends and taxes / Dividends and capital gains under the 1986 Tax Reform Act
16-6 The Middle-of-the-Roaders 388
Alternative tax systems
16-7 Summary 390
Further Reading 391
Quiz 392
Questions and Problems 393
Chapter 17 Does Debt Policy Matter? 397
17-1 The Effect of Leverage in a Competitive Tax-Free Economy 398
Enter Modigliani and Miller / The law of the conservation of value / An example
of Proposition I
17-2 How Leverage Affects Returns 404
Implications of Proposition I / Proposition II / The risk-return trade-off
17-3 The Traditional Position 407
Two warnings / Rates of return on levered equity-The traditional position / Where
to look for violations of MM s Propositions / Today s unsatisfied clienteles are
probably interested in exotic securities / Pfizer s stillborn USUs / Imperfections
and opportunities
xvi Contents
17-4 Summary 415
Appendix: MM and the Capital Asset Pricing Model 415
Further Reading 416
Quiz 417
Questions and Problems 419
Chapter 18 How Much Should a Firm Borrow? 421
18-1 Corporate Taxes 422
How do interest tax shields contribute to the value of stockholders equity? /
Recasting Merck s capital structure / MM and taxes
18-2 Corporate and Personal Taxes 426
Debt policy before and after tax reform / Merton Miller s Debt and Taxes /
Miller s Model after the 1986 Tax Reform Act I A possible compromise theory?
18-3 Costs of Financial Distress 434
Bankruptcy costs / Evidence on bankruptcy costs / Direct versus indirect costs of
bankruptcy / Financial distress without bankruptcy / Risk shifting: The first game /
Refusing to contribute equity capital: The second game / And three more games,
briefly / What the games cost / Costs of distress vary with type of asset
18-4 Explaining Financing Choices 445
A pecking order theory
18-5 Choosing the Firm s Debt-Equity Ratio 447
A checklist / Planning ahead
18-6 Summary 449
Further Reading 450
Quiz 451
Questions and Problems 453
Chapter 19 Interactions of Investment and Financing Decisions 457
19-1 The Adjusted Present-Value Rule 458
The base case / Issue costs / Additions to the firm s debt capacity / The value
of interest tax shields / Review of the adjusted-present-value approach
19-2 Adjusted Discount Rates-An Alternative to Adjusted Present Value 461
Example: The geothermal project / A general definition of the adjusted cost of
capital I What happens when future debt levels are uncertain? / How useful are
adjusted-cost-of-capital formulas?
19-3 The Weighted-Average-Cost-of-Capital Formula 466
Now we apply the textbook formula to the geothermal project / Using the textbook
formula / An application to the railroad industry / A note on asset betas and the
weighted-average cost of capital / Mistakes people make in using the weighted-
average formula
19-4 Discounting Safe, Nominal Cash Flows 470
A general rule / Some further examples / Adjusted discount rates for debt-equivalent
cash flows
19-5 Summary 474
Further Reading 476
Quiz 477
Questions and Problems 478
Contents xvii
PART SIX OPTIONS
Chapter 20 Corporate Liabilities and the Valuation of Options 483
20-1 Calls, Puts, and Shares 485
Selling calls, puts, and shares
20-2 Holding Calls, Puts, and Shares in Combination 488
The difference between safe and risky bonds / Spotting the option
20-3 What Determines Option Values? 494
20-4 An Option-Valuation Model 498
Why discounted cashflow won t work for options / Constructing option equivalents
from common stocks and borrowing / The risk-neutral method / Valuing options
that last for more than one period / Using the Black-Scholes formula
20-5 Summary 503
Further Reading 504
Quiz 504
Questions and Problems 506
Chapter 21 Applications of Option Pricing Theory 511
21-1 The Value of Follow-On Investment Opportunities 511
Real options and the value of management
21-2 The Option to Abandon 514
Valuing the abandonment put-An example / What happens to Ms. Magna s option
if there are more than two possible outcomes? / Option values after 6 months /
Option value now / The general binomial method
21-3 The Timing Option 521
Example of timing option / Valuing the malted herring option / Option valuation
and decision trees
21-4 A Checklist 525
American calls-No dividends / European puts-No dividends / American puts-No
dividends / European calls on dividend-paying stocks /American calls on dividend-
paying stocks
21-5 Summary 529
Further Readings 530
Questions and Problems 531
Chapter 22 Warrants and Convertibles 535
22-1 What Is a Warrant? 535
Valuing warrants / Two complications: Dividends and Dilution j Example: Valuing
United Glue s warrants / How the value of United Warrants is affected by dilution /
Warrants on bonds
22-2 What Is a Convertible Bond? 541
Valuing convertible bonds / Dilution and dividends revisited / Forcing conversion
22-3 The Difference between Warrants and Convertibles 547
22-4 Why Do Companies Issue Warrants and Convertibles? 547
22-5 Summary 549
Further Reading 550
xviii ______________________________________________^_________________Contents
Quiz 551
Questions and Problems 552
PART SEVEN DEBT FINANCING
Chapter 23 Valuing Risky Debt 557
23-1 The Classical Theory of Interest 558
Real interest rates / Inflation and interest rates
23-2 Term Structure and Yields to Maturity 561
Yield to maturity / Problems with yield to maturity / Measuring the term
structure / Pricing bonds of different maturity
23-3 Explaining the Term Structure 569
Ms. Long s problem / Mr. Short s problem / The expectations hypothesis / The
liquidity-preference theory / Introducing inflation / A comparison of theories of
term structure / Some new theories of the term structure
23-4 Allowing for the Risk of Default 578
Bond ratings / Junk bonds / Option pricing and risky debt / Valuing government
loan guarantees
23-5 Summary 585
Further Reading 587
Quiz 588
Questions and Problems 589
Chapter 24 The Many Different Kinds of Debt 593
24-1 Domestic Bonds, Foreign Bonds, and Eurobonds 594
24-2 The Bond Contract 595
Indenture, or trust deed / The bond terms / Registered and bearer bonds
24-3 Security and Seniority 597
24-4 Repayment Provisions 599
Sinking funds / Call provisions / Extendable and retractable bonds
24-5 Restrictive Covenants 601
Changes in covenant protection / Positive covenants
24-6 Innovation in the Bond Market 604
The causes of innovation / The gains from innovation / Lasting innovations
24-7 Project Finance 608
An example from the oil industry / Who uses project finance? / Project Finance-
some common features / The benefits of project finance
24-8 Summary 612
Appendix: Excerpts from a Prospectus for a Bond Issue 614
Further Reading 623
Quiz 623
Questions and Problems 624
Chapter 25 Hedging Financial Risk 627
25-1 The Technique of Hedging 630
How hedging instruments allows you to separate your bets
Contents xix
25-2 Duration and Volatility 632
Example and some refinements
25-3 Hedging with Futures 635
Commodity and financial futures / The mechanics of futures trading / Spot and
futures prices-Financial futures / Spot and futures prices-Commodities / Setting
up a futures hedge
25-4 Forward Contracts 640
Homemade forward contracts
25-5 swaps 642
25-6 Hedging with Options 643
25-7 Summary 644
Further Reading 645
Quiz 646
Questions and Problems 647
Chapter 26 Leasing 653
26-1 What Is a Lease? 653
26-2 Why Lease? 654
Sensible reasons for leasing / Some dubious reasons for leasing
26-3 Valuing Financial Leases 658
Example of a financial lease / Who really owns the leased asset? / Leasing and the
Internal Revenue Service / A first pass at valuing / A lease contract / Why leasing
would make Greymare s shareholders worse off / The story so far
26-4 When Does Leasing Pay? 664
26-5 Evaluating a Large, Leveraged Lease 665
26-6 Summary 668
Further Reading 669
Quiz 669
Questions and Problems 671
PART EIGHT FINANCIAL PLANNING
Chapter 27 Analyzing Financial Performance 675
27-1 Financial Ratios 675
Leverage ratios / Liquidity ratios / Profitability, or efficiency, ratios / Market value
ratios / Accounting definitions / Choosing a benchmark / Which financial ratios?
27-2 The Earnings Record 689
The meaning of accounting earnings / How inflation affects book returns
27-3 Applications of Financial Analysis 693
Using financial ratios to estimate market risk / Using financial ratios to predict
bond ratings
27-4 Summary 696
Further Reading 696
Quiz 697
Questions and Problems 699
xx Contents
Chapter 28 Approaches to Financial Planning 701
28-1 What Is Financial Planning? 701
Financial planning focuses on the big picture / Financial planning is not just
forecasting
28-2 The Contents of a Completed Financial Plan 703
Planned financing / Three requirements for effective planning / Financial planning
as managing a portfolio of options
28-3 Financial Planning Models 707
Executive Fruit s financial model / Pitfalls in model design / There is no finance
in corporate financial models
28-4 Summary 712
Appendix: LONGER 713
Example / Extending the model / Comparison of LONGER with the typical corporate
planning model / Shadow prices, or marginal costs
Further Reading 720
Quiz 720
Questions and Problems 721
Chapter 29 Short-Term Financial Planning 723
29-1 The Components of Working Capital 724
29-2 Links between Long-Term and Short-Term Financing Decisions 725
Matching maturities / Permanent working-capital requirements / The comforts
of surplus cash
29-3 Tracing Changes in Cash and Working Capital 727
Tracing changes in net working capital / Profits and cash flow
29-4 Cash Budgeting 732
Preparing the cash budget: Inflow / Preparing the cash budget: Outflow
29-5 The Short-Term Financing Plan 735
Options for short-term financing / The first financing plan / The second financing
plan I A note on short-term financial planning models
29-6 Summary 741
Further Reading 742
Quiz 742
Questions and Problems 743
PART NINE SHORT-TERM FINANCIAL DECISIONS
Chapter 30 Credit Management 747
30-1 Terms of Sale 747
30-2 Commercial Credit Instruments 748
30-3 Credit Analysis 750
Financial ratio analysis / Numerical credit scoring / Constructing better risk indexes
30-4 The Credit Decision 755
When to stop looking for clues / Credit decisions with repeat orders / Some general
principles
Contents xxi
30-5 Collection Policy 759
Factoring and credit insurance
30-6 Summary 761
Appendix: Bankruptcy Procedures 761
Personal bankruptcies / Business bankruptcies / The choice between liquidation
and reorganization
Further Reading 766
Quiz 767
Questions and Problems 768
Chapter 31 Cash Management 773
31-1 Inventories and Cash Balances 774
The extension to cash balances / The Miller-Orr model / Using the Miller-Orr
model I Raising cash by borrowing / Cash management in the largest corporations
31-2 Cash Collection and Disbursement Systems 781
Float I Managing float / Speeding up collections / Controlling disbursements
31-3 Bank Relations 786
What happens if money pays interest?
31 -4 Summary 787
Further Reading 788
Quiz 788
Questions and Problems 790
Chapter 32 Short-Term Lending and Borrowing 793
32-1 Short-Term Lending 793
The money market / Valuing money-market investments / Calculating the yield on
money-market investments / U.S. Treasury bills / Agency securities / Short-term
tax-exempts / Bank time deposits and certificates of deposit / Commercial paper and
medium-term notes / Bankers acceptances / Repurchase agreements
32-2 Floating-Rate Preferred Stock-An Alternative to Money-Market Investments 800
32-3 Short-Term Borrowing 801
Credit rationing / Unsecured loans / Loans secured by receivables / Loans secured by
inventory
32-4 Term Loans 805
Loan participations and assignments / Eurodollar lending
32-5 Summary 807
Further Reading 809
Quiz 809
Questions and Problems 811
PART TEN MERGERS, INTERNATIONAL FINANCE, AND PENSIONS
Chapter 33 Mergers 817
33-1 Estimating the Economic Gains and Costs of Mergers 817
Right and wrong ways to estimate the benefits of mergers
xxii Contents
33-2 Sensible Motives for Mergers 820
Economies of scale / Economies of vertical integration / Combining complementary
resources / Unused tax shields / Mergers as a use for surplus funds / Eliminating
inefficiencies
33-3 Some Dubious Reasons for Mergers 824
Diversification / The bootstrap game: Mergers and earnings per share / Lower
financing costs
33-4 Estimating the Cost of a Merger 828
Estimating cost when the merger is financed by cash / Estimating cost when the
merger is financed by stock / Asymmetric information
3 3-5 The Mechanics of a Merger 831
Mergers and antitrust law / The form of acquisition / A note on merger
accounting j Some tax considerations
33-6 Merger Tactics 835
The fight for Cities Service / Is is better to sell than buy? / Takeover defenses /
Phillips restructures to stave off takeover / Divestitures and spin-offs
33-7 LBOs 842
RJR Nabisco / Barbarians at the gate?
33-8 Mergers and the Economy 846
Merger waves / Do mergers generate net benefits?
33-9 Summary 849
Further Reading 850
Quiz 851
Questions and Problems 852
Appendix: Conglomerate Mergers and Value Additivity 854
Chapter 34 International Financial Management 857
34-1 The Foreign Exchange Market 857
34-2 Some Basic Relationships 860
Interest rates and exchange rates / The forward premium and changes in spot
rates / Changes in the exchange rate and inflation rates / Interest rates and inflation
rates / Is life really that simple?
34-3 Insuring against Currency Risks 867
34-4 International Investment Decisions 870
34-5 The Cost of Capital for Foreign Investment 873
Does Japan enjoy a lower cost of capital? / Avoiding fudge factors in international
investment decisions
34-6 Financing Foreign Operations 876
Tax and the financing method
34-7 Political Risk 879
34-8 Interactions of Investment and Financing Decisions 880
34-9 Summary 881
Further Reading 882
Quiz 883
Questions and Problems 885
Contents xxiii
Chapter 35 Pension Plans 887
35-1 Types of Pension Plan 887
35-2 ESOPs and Other Employee Benefits 888
35-3 The Pension Plan Balance Sheet 892
Valuing the pension liabilities / Valuing the pension assets / Determining the
pension contribution / A comment on actuarial assumptions I ERISA, fund
contributions, and pension insurance j Plan terminations / Accounting for the
pension plan
35-4 Managing the Pension Fund 898
Risk and pension fund policy / Tax and pension fund policy / Setting objectives
35-5 Measuring Fund Performance 901
Choosing the performance yardstick / Measuring performance-An example j Some
cautions about performance measurement
35-6 Summary 906
Further Reading 907
Quiz 908
Questions and Problems 910
PART ELEVEN CONCLUSIONS
Chapter 36 Conclusion: What We Do and Do Not Know about Finance 915
36-1 What We Do Know: The Six Most Important Ideas in Finance 915
1 Net present value / 2 The capital asset pricing model / 3 Efficient capital
markets j 4 Value additivity and the law of the conservation of value j 5 Option
theory / 6 Agency theory
36-2 What We Do Not Know: 10 Unsolved Problems in Finance 918
/ How are major financial decisions made? / 2 What determines project risk and
present value? / 3 Risk and return-Have we missed something? / 4 Are there
important exceptions to the efficient-market theory? / 5 Is management an
off-balance sheet liability? / 6 How can we explain the success of new securities and
new markets? / 7 How can we explain capital structure? / 8 How can we resolve the
dividend controversy? / 9 What is the value of liquidity? / 10 How can we explain
merger waves?
36-3 A Final Word 924
Appendix: Present Value Tables API
Glossary GI
Answers to Quizzes AN I
Index i-l
|
| any_adam_object | 1 |
| author | Brealey, Richard A. 1936- Myers, Stewart C. 1940- |
| author_GND | (DE-588)124289401 (DE-588)129325023 |
| author_facet | Brealey, Richard A. 1936- Myers, Stewart C. 1940- |
| author_role | aut aut |
| author_sort | Brealey, Richard A. 1936- |
| author_variant | r a b ra rab s c m sc scm |
| building | Verbundindex |
| bvnumber | BV007193603 |
| callnumber-first | H - Social Science |
| callnumber-label | HG4026 |
| callnumber-raw | HG4026 |
| callnumber-search | HG4026 |
| callnumber-sort | HG 44026 |
| callnumber-subject | HG - Finance |
| classification_rvk | QP 700 |
| ctrlnum | (OCoLC)22984028 (DE-599)BVBBV007193603 |
| dewey-full | 658.15 |
| dewey-hundreds | 600 - Technology (Applied sciences) |
| dewey-ones | 658 - General management |
| dewey-raw | 658.15 |
| dewey-search | 658.15 |
| dewey-sort | 3658.15 |
| dewey-tens | 650 - Management and auxiliary services |
| discipline | Wirtschaftswissenschaften |
| edition | 4. ed. |
| format | Book |
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| genre | (DE-588)4151278-9 Einführung gnd-content |
| genre_facet | Einführung |
| id | DE-604.BV007193603 |
| illustrated | Illustrated |
| indexdate | 2024-12-20T08:59:47Z |
| institution | BVB |
| isbn | 0070074054 0071007563 |
| language | English |
| oai_aleph_id | oai:aleph.bib-bvb.de:BVB01-004601546 |
| oclc_num | 22984028 |
| open_access_boolean | |
| owner | DE-19 DE-BY-UBM DE-703 DE-N2 DE-523 DE-83 DE-11 DE-188 |
| owner_facet | DE-19 DE-BY-UBM DE-703 DE-N2 DE-523 DE-83 DE-11 DE-188 |
| physical | Getr. Zählung graph. Darst. |
| publishDate | 1991 |
| publishDateSearch | 1991 |
| publishDateSort | 1991 |
| publisher | McGraw-Hill |
| record_format | marc |
| series2 | McGraw-Hill series in finance |
| spellingShingle | Brealey, Richard A. 1936- Myers, Stewart C. 1940- Principles of corporate finance Bedrijfsfinanciering gtt Entreprises - Finances - Cas, Études de Entreprises - Finances - Guides, manuels, etc Inversiones - Modelos matemáticos Sociétés - Finances - Cas, Études de Sociétés - Finances - Guides, manuels, etc Corporations Finance Finanzierung (DE-588)4017182-6 gnd Finanzmanagement (DE-588)4139075-1 gnd Finanzplanung (DE-588)4017200-4 gnd Unternehmen (DE-588)4061963-1 gnd Corporate Finance (DE-588)4269795-5 gnd |
| subject_GND | (DE-588)4017182-6 (DE-588)4139075-1 (DE-588)4017200-4 (DE-588)4061963-1 (DE-588)4269795-5 (DE-588)4151278-9 |
| title | Principles of corporate finance |
| title_auth | Principles of corporate finance |
| title_exact_search | Principles of corporate finance |
| title_full | Principles of corporate finance Richard A. Brealey ; Stewart C. Myers |
| title_fullStr | Principles of corporate finance Richard A. Brealey ; Stewart C. Myers |
| title_full_unstemmed | Principles of corporate finance Richard A. Brealey ; Stewart C. Myers |
| title_short | Principles of corporate finance |
| title_sort | principles of corporate finance |
| topic | Bedrijfsfinanciering gtt Entreprises - Finances - Cas, Études de Entreprises - Finances - Guides, manuels, etc Inversiones - Modelos matemáticos Sociétés - Finances - Cas, Études de Sociétés - Finances - Guides, manuels, etc Corporations Finance Finanzierung (DE-588)4017182-6 gnd Finanzmanagement (DE-588)4139075-1 gnd Finanzplanung (DE-588)4017200-4 gnd Unternehmen (DE-588)4061963-1 gnd Corporate Finance (DE-588)4269795-5 gnd |
| topic_facet | Bedrijfsfinanciering Entreprises - Finances - Cas, Études de Entreprises - Finances - Guides, manuels, etc Inversiones - Modelos matemáticos Sociétés - Finances - Cas, Études de Sociétés - Finances - Guides, manuels, etc Corporations Finance Finanzierung Finanzmanagement Finanzplanung Unternehmen Corporate Finance Einführung |
| url | http://bvbr.bib-bvb.de:8991/F?func=service&doc_library=BVB01&local_base=BVB01&doc_number=004601546&sequence=000002&line_number=0001&func_code=DB_RECORDS&service_type=MEDIA |
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