Course: Introduction to Business Finance

Semester: Spring 2023

Course ID: 112450
Faculty: Dr. Danish

COURSE OUTLINE

COURSE LEARNING OUTCOMES

After studyingthis course,students will beableto:
CLO 1:Understand the role of business finance.
CLO 2: Analyze financial statements.
CLO 3: Understand the concept of time value of money in investing decisions.
CLO 4: Understand the concepts of risk and return for portfolio management.
CLO 5: Calculate the value of bonds and debt securities
CLO 6: Calculate the value of stocks and equity instruments
CLO 7: Understand and calculate weighted average cost of capital.
CLO 8: Discuss their course project work through a class presentation.
CLO 9: Understand the real-world application of the course topics through interaction with industry
professionals.

GENERAL PEDAGOGY OF CLASS CONDUCT

1. Before class self-study.
2. In-class discussion and quizzes.
3. Case analysis/assignments for developing analytical skills, problem-solving and decision making.
4. Application of confidence-building measures through classroom exercises (presentations etc.)

WEEK TOPIC Book Chapter Online material Class Activity

Week 1- AN OVERVIEW OF BUSINESS https://youtu.be/nazyc8bbsVA Discussion
2 FINANCE (1:31:06)
Forms of business organization.
Goals of business finance
https://youtu.be/2iucVkpfTZY
(1:12:44)

https://youtu.be/CG5cZlXarqM
(1:37:54) (Optional)

https://youtu.be/kCPcxWd_jTU
(1:44:34) (Optional)

3-4 Revision of financial statements i.e. 2 Financial https://youtu.be/fPnis45IvVw W3: Presentation

income statement, balance sheet, cash statements, (1:44:23) based Discussion.
flow statement and statement of Cash flows
changes in equity. and Taxes https://youtu.be/iFYRHrBFG0A W4: Mini case
(1:59:02) chap2

Week 5- ANALYSIS OF FINANCIAL 3 Analysis https://youtu.be/DuQyzv5IPI8 W5: Presentation

6 STATEMENTS of Financial (1:46:14) based Discussion.
Ratio analysis Statements
The Du-Pont analysis https://youtu.be/dwBu7y30UZs W6: Mini case
Common size analysis (1:56:35) chap3
 Trend analysis
https://youtu.be/ex3fIn-rbZs
(1:21:51)

https://youtu.be/KBU1YCe-hYw
(1:21:10)

Week 7 TIME VALUE OF MONEY 4 Time Discussion and

The role and perspectives of the TVM Value of https://youtu.be/H1Z-N3GI5pc Mini case chap4
concept money (26:59)
Present value
Future value https://youtu.be/rJsR2P-7Ol4
The relationship between future and (1:28:20)
present values
Annuities and its Types https://youtu.be/zuLIoIzClR4
Future and present values of cash flows (1:14:19)
under high compounding frequency
Impact of higher compounding
frequency
Inflation and the Time Value of Money
Effective Annual Rate (EAR)
Week 8- BOND VALUATION 5 Bond https://youtu.be/fPhcRqavJ18 W8: Presentation
9 Definition, types and features of bonds valuation (41:38) based Discussion.
Valuation of annual, semi-annual and
perpetual bonds https://youtu.be/0O2ZqFdFea4 W9: Mini case
Basic relationships in bond valuation (1:49:43) chap5
Bond holders expected rate of return
Risks associated with bond returns https://youtu.be/9TchbSPirs0
(1:36:15)

https://youtu.be/KoF3OEuKO3s
(2:25:06)

https://youtu.be/ICtN2skLhQY
(1:28:03)

Week RISK AND RETURN 6 Risk and https://youtu.be/_D5PJJdAakI W10: Presentation

10-11 Expected returns and risk defined Rate of (2:56:06) based Discussion.
Calculating expected return Return
Calculating risk (Variance and Standard https://youtu.be/og471LgZcaw W11: Mini case
deviation) (1:28:03) chap6
Portfolio expected returns
Portfolio variance and standard https://youtu.be/Zc97-sL-zec
deviation (1:52:08)
Systematic and unsystematic risk
Diversification and portfolio risk
Beta and Portfolio Beta
Capital Asset Pricing Model (CAPM)
Week 12 STOCK VALUATION 7 Stock https://youtu.be/i_JmHsgmW4w Discussion and
Types of stocks and their basic features Valuation (1:29:06) Mini case chap7
Costs and benefits of stock investments
Valuation of zero-growth stocks, https://youtu.be/lWxPWElSnmU
constant growth stocks and non- (58:45) (EMH-optional)
constant growth stocks
Price of shares based on earnings
Expected rate of return
Preferred shares and their
characteristics
 Valuation of preferred shared and the
expected rate of return
Week 13 COST OF CAPITAL 9 The Cost Discussion and
The concept of cost of capital of Capital https://youtu.be/7aVLAfx3anQ Mini case chap 9
Weighted average costs of capital (1:36:02)
Cost of debt
Cost of retained earnings
Cost of external equity
Cost of preferred equity
Week Project Presentation Group
14-15 presentation and
viva

COURSETEXTBOOK
Financial Management (14th edition) by Eugene F. Brigham and Michael C. Ehrhardt, Cengage.

CASES STUDIES
Case studies will be given to students on a periodic basis to illustrate real-world applications of various
topics covered in this course.

GROUP PROJECT
Each project group should prepare a financial feasibility report of a proposed new business venture in
Pakistan. The feasibility report should be based on a realistic business idea/plan fully recognizing the
constraints facing the group (such as time, limited investment and lack of experience). The project must
also be presented in class via a PowerPoint presentation.

MARKS DISTRIBUTION
ASSESSMENT
RUBRICS WEIGHTAGE
METHODS
Developing analytical skills,
Assignments/case studies/
2 problem-solving approach and 15%
Class participation
decision making.
4 Mid Term test 20%

5 Final exam 40%

Industry-based problem solving
and delivery in front of the
audience to enhance confidence
6 Project and presentation 25%
and communication of students
as well as understanding of real-
world issues.
Total 100%