Free online courseCorporate Finance Second Edition

Course Description

Corporate finance is ultimately about making better decisions with limited resources and real uncertainty. This course helps you think like a decision-maker: choosing investments that create value, setting hurdle rates that match risk, and understanding how financing choices shape what a business can do next. Instead of memorizing formulas, you will learn how to frame questions the way practitioners do, connect assumptions to outcomes, and spot where a model can mislead you.

You will start by clarifying the purpose of corporate finance and the logic behind value maximization, including what changes when power sits with founders, voting shareholders, managers, lenders, or regulators. From there, you will build intuition for risk, risk-free rates across currencies, and equity risk premiums, then translate that into the cost of equity and the cost of debt. The course emphasizes how diversified investors are compensated for risk, why betas move, and how leverage can amplify sensitivity to economic shocks.

As the course progresses, you will apply these building blocks to investment analysis: measuring returns correctly, separating incremental cash flows from accounting noise, and handling uncertainty without freezing decision-making. You will learn how to treat sunk costs, recognize opportunity costs, and compare NPV and IRR in ways that reflect real trade-offs. The lessons also introduce strategic flexibility, such as the option to delay, and explain why it can meaningfully change how an investment should be judged.

You will then explore financing and payout decisions: the trade-offs behind debt versus equity, how firms think about optimizing their financing mix, and why the design of debt should fit the cash flows of the business. You will also examine dividends versus buybacks, taxes, investor clienteles, and what can go wrong when cash is returned faster than the business can sustainably generate it. Finally, the course ties these decisions together through valuation, helping you connect growth, reinvestment, margins, and risk into a coherent view of what drives business value.

With integrated practice questions throughout, you will leave with a sharper toolkit for evaluating projects, acquisitions, capital structure choices, and valuation narratives—skills that translate to roles in finance, consulting, strategy, entrepreneurship, and investing.