Essentials of Corporate Finance

Robert Parrino is the Lamar Savings Centennial Professor of Finance at the McCombs School of Business of The University of Texas at Austin.? He formerly held academic appointments at The University of Chicago, the University of Rochester, and IMADEC University in Vienna. Dr. Parrino's research includes work on corporate governance, financial policies, restructuring, and mergers and acquisitions, as well as research on private equity markets. He has published his research in a number of journals, including the Journal of Finance, Journal of Financial Economics, Journal of Financial and Quantitative Analysis, Journal of Law and Economics, Journal of Portfolio Management, and Financial Management. Dr. Parrino has won a number of awards for his research. He received his PhD from the University of Rochester. David Kidwell is the Professor of Finance and Dean Emeritus at the Curtis L. Carlson School of Management, University of Minnesota. Dr. Kidwell has over 30 years experience in financial education, as a teacher, researcher, and administrator. He has served as Dean of the Carlson School at the University of Minnesota and of the School of Business Administration at the University of Connecticut. Prior to joining the University of Connecticut, Dr. Kidwell held endowed chairs in banking and finance at Tulane University, the University of Tennessee, and Texas Tech University. He was also on the faculty at the Krannert Graduate School of Management, Purdue University where he was twice voted the outstanding undergraduate teacher of the year. Thomas Bates is Chair of the Department of Finance at Arizona State University W.P. Carey School of Business. He received his PhD from The University of Pittsburgh and has held academic positions at the University of Arizona, University of Delaware and the University of Western Ontario. His research interests include Corporate Finance, Corporate Governance, Mergers and Acquisitions, and Valuation.? He has been published in the Journal of Finance, and the Journal of Financial Economics.

• PART 1 INTRODUCTION 1 The Financial Manager and the Firm 1PART 2 FOUNDATIONS2 The Financial System and the Level of Interest Rates 263 Financial Statements, Cash Flows, and Taxes 504 Analyzing Financial Statements 83PART 3 VALUATION OF FUTURE CASH FLOWS5 The Time Value of Money, Discounted Cash Flows, and Valuation 1266 Risk and Return 1837 Bond Valuation and the Structure of Interest Rates 2218 Stock Valuation 253PART 4 CAPITAL BUDGETING DECISIONS9 The Fundamentals of Capital Budgeting 28410 Cash Flows and Capital Budgeting 32811 The Cost of Capital 363PART 5 FINANCING DECISIONS12 Working Capital Management 39513 How Firms Raise Capital 42614 Capital Structure Policy 45815 Dividends, Stock Repurchases, and Payout Policy 495PART 6 FINANCIAL PLANNING16 Financial Planning and Managing Growth 519PART 7 INTERNATIONAL DECISIONS17 International Financial Management 554