Valuation, broadly-defined, consists of determining the effect of business decisions on the overall value of the firm, and is a process routinely performed in examining corporate finance decisions at a firm. There are three primary goals of this course.
1. To teach you the basic concepts behind valuing projects and firms;
2. To enhance your ability to apply valuation theory and techniques to real-world situations; and
3. To enable you to communicate technical concepts in everyday language.
A secondary goal is to lay the groundwork for future corporate finance courses you may take.
Throughout the term, I will try to keep the focus on the concepts involved. The theory is important because it allows us to extend standard techniques to non-standard situations. Of course, valuation requires dealing with lots of numbers, and we will necessarily have to master the details of the calculations as well. The cases represent the real-world situations we will examine.