FIN435 • Course Hub Spring 2026

Central hub for FIN435. Reference site from prior class: https://www.jufinance.com/fin435_25s/
Theme:

Course Basics & Projects

Meeting: SIJU137 • TR 12:30–1:45 PM  |  Instructor: Maggie Foley (mfoley3@ju.edu) • DCOBT 118A • Office Hours T/TR 3:30–5:00 PM

Syllabus (On-Page)

Meeting Information

Section: FIN 435 102Z (Spring 2026)

When/Where: TR 12:30–1:45 PM • SIJU137

Instructor: Maggie Foley (mfoley3@ju.edu)

Office: DCOBT 118A

Office Hours: T/TR 3:30–5:00 PM

Required Textbook

Fundamentals of Financial Management (16th ed.)

Brigham & Houston • Cengage Learning (2021)

ISBN-13: 978-0357517574

Purchase options: JU Bookstore Course Finder

Exam Dates (from syllabus)

  • Midterm 1: Tue, 2/24
  • Midterm 2: Thu, 4/7
  • Final + Exit Exam: Tue, 4/28 (11:30–2:00 PM)

See “Exams & Solutions” below for study guides & posted solutions.

Grading & Coursework (official weights) (click to expand)
ComponentWeight
3 Exams55%
Project – 8 case studies15%
Exit Exam10%
Term Project10%
Quiz10%
Extra creditUp to 5 points total

Attendance is checked via the end-of-class quiz.

Weekly Schedule (from syllabus)

▶ Schedule (click to expand)
Date Day Topic Notes
1/13TueSyllabus
1/15ThuChapter 6-1
1/20TueChapter 6-2
1/22ThuCase study of Chapter 6
1/27TueChapter 7-1
1/29ThuChapter 7-2
2/3TueCase Study of Chapter 7
2/5ThuChapter 8-1
2/10TueChapter 8-2
2/12ThuCancelled due to attending AEF conferenceNo class
2/17TueEfficient Frontier Term Project -1
2/19ThuEfficient Frontier Term Project -2
2/24TueFirst Midterm Exam
2/26ThuChapter 9
3/3TueCase study of Chapter 9
3/5ThuChapter 10
3/10TueCase study of Chapter 10, Chapter 11
3/12ThuChapter 11 Case study
3/16–3/20—Spring BreakNo classes
3/24TueReview
3/26ThuSecond Midterm Exam
3/31TueChapter 3, and Chapter 3 case study
4/2ThuChapter 12
4/7TueCase study of Chapter 12 (Monte Carlo Analysis)
4/9ThuChapter 19
4/14TueCase study of Chapter 19
4/16ThuChapter 15
4/21TueChapter 21
4/23ThuReview
4/28TueFinal Exam (11:30–2:00 PM) and Exit Exam

Exams & Solutions

Study guides and solutions for each exam are organized below.

First Midterm Exam 2/24

Covers: Chapters 6, 7, and 8

Part A: 30 True/False questions  |  Part B: 15 calculator questions

Chapter 6 Study Guide

Interest rates review for Midterm 1.

Open Chapter 6 Guide

Chapter 7 Study Guide

Bond pricing, yields, and bond risk review.

Open Chapter 7 Guide

Chapter 8 Study Guide

Risk, return, beta, and diversification review.

Open Chapter 8 Guide
First Midterm Calculation Solutions First Midterm T/F Solutions
Second Midterm Exam 4/7 Do Not Miss

Second Midterm Exam is coming soon.

Date: Thursday, 4/7  |  Please prepare early.

Covers: Chapter 10 (WACC), Chapter 11 (Capital Budgeting), and Chapters 3 & 12 (DCF / Cash Flow Estimation)

Part A: 30 concept / true-false style questions = 45 points  |  Part B: 10 calculation questions = 55 points

Concept Study Guide Calculation Study Guide
Second Midterm Solution

The concept guide covers what you should know. The calculation guide gives practice with the style of quantitative problems that may appear on the exam.

Note: Solution link is reserved here for later posting. It may not be available yet.

Final Exam + Exit Exam 4/28 • 11:30–2:00

Comprehensive final exam. Study guide posted before the exam; solutions posted after.

Final Study Guide Final Solution Chapter 19 Case Study

Reminder: The fourth Chapter 19 item opens a simple page with the Excel case file and the class video, and it is due with the final.

Trading Game Tools (FINVIZ + MarketWatch)

Use these for the class MarketWatch game. Open an app, pick candidates in Finviz, then size the trade properly.

Featured Video

MarketWatch game walkthrough

Short-Only Scanner (App)

Daily shorts with presets, risk tool, checklist.

Open Short App

Long-Only Position Builder (App)

Fundamentals + technical entries, sector mix planner.

Open Long App

MarketWatch Game Website

Create/join your class game (Virtual Stock Exchange).

Open MarketWatch Games

FINVIZ Screener

Run scans, then use the apps above for sizing & diversification.

Open FINVIZ

How to Win the MarketWatch Game

  • Risk 1% per trade (use the app calculator). Journal each trade.
  • Diversify (cap ≈ 25% per sector). Avoid crowding one theme.
  • Entries: Long—buy dips in uptrends; Short—fade weak bounces.
  • News check: Don’t short fresh strong catalysts; ride positive drift on longs.
  • Protect winners: Take partials; trail stops near support/resistance.

Class Game Room

Game - FIN435 Spring 2026 (Live) (password: havefun)

Use the password exactly as shown.

Chapters

Each chapter card links to (1) your chapter website and (2) the slide deck.

Module 1 Market Games (Silver + USD/JPY) 1/15

Enrichment games (same as FIN415).

Silver Game (XAG) USD/JPY Timeline
Silver Price Forecast Game — Student IDs Only (click to expand)

Target date: 4/15/26. Guess the silver spot price ($/oz) on that date. Closest guess earns +5 extra points. Posted as Student ID only (no names). If there is a tie, all tied students receive the extra points.

Student ID Guess ($/oz)
01700
0280
03107
04250
05130
06149
07105
08124
09550
10112
11111
1294
13144
14101
15135
16145
17103
18115
1999
20105
2145
2297
23111
24123
2588

Winner is the closest submission to the posted 4/15/26 spot price.

Chapter 6 Interest Rates 1/20 • 1/22

Open Chapter 6 Website Slides (PPTX) Quiz 1 (T/F) Quiz 2 (T/F) Class Notes (HTML)

Chapter 7 Bonds 1/27 • 1/29

Open Chapter 7 Website Slides (PPTX) Quiz (T/F)
Class Notes + Quick Summary (click to expand)

Goal: price bonds correctly, interpret yields, and explain interest-rate risk and credit/call risk.

  • Bond price = PV(coupons) + PV(par) discounted at the required yield (YTM as IRR).
  • Price–yield inverse: yield ↑ ⇒ price ↓; yield ↓ ⇒ price ↑.
  • Premium vs discount: coupon rate > YTM ⇒ premium; coupon rate < YTM ⇒ discount.
  • Current yield = annual coupon ÷ price (income only). YTM includes price pull-to-par + timing.
  • Duration (rate risk): higher duration ⇒ bigger % price move for a given Δy (1st-order sensitivity).
  • Callable bonds: upside is capped when rates fall (call risk; negative convexity region).
  • Risk premiums: Treasuries mainly term/liquidity; corporates add default + liquidity premiums.

Common exam traps: confusing coupon rate vs YTM; treating current yield as “total return”; forgetting call risk limits price gains; assuming higher coupon ⇒ higher duration (often the opposite).

Chapter 8 Risk & Return 2/3 • 2/5

Open Chapter 8 Website Slides (PPTX)
Brief Class Notes (click to expand)

Goal: explain the tradeoff between risk and expected return, and compute returns + risk correctly.

  • Return (R): % change in wealth. For one period: (P1 − P0 + Div) / P0.
  • Expected return E[R]: probability-weighted average of possible returns.
  • Risk = variability: measured by variance and standard deviation (σ).
  • Diversification: portfolio risk depends on correlation (ρ) — low/negative correlation reduces σp.
  • Beta (β): “market sensitivity.” β > 1 = more volatile than market; β < 1 = defensive.
  • CAPM idea: investors get paid for systematic risk (β), not diversifiable risk.

Common exam traps: confusing E[R] with realized return, forgetting dividends, and assuming diversification means “more stocks” (it means low correlation).

Term Project Efficient Frontier 2/17 • 2/19

Project build + submission instructions.

Open Term Project Page

Chapter 10 Cost of Capital 2/26 • 3/3

Open Chapter 10 Website Slides (PPTX)
Brief Notes (WACC + Monte Carlo) (click to expand)

Goal: compute WACC correctly and understand how interest rates (YTM) + taxes drive the cost of debt and the overall discount rate.

  • Master formula: WACC = (D/(D+E))·Kd(1−T) + (E/(D+E))·Ke
  • Cost of debt (Kd): use the bond’s YTM as before-tax Kd; then apply the tax shield: Kd_after = YTM·(1−T).
  • Coupon timing matters: if the bond pays semiannually, use RATE(nper·2, pmt/2, −Price, Par)·2.
  • Cost of equity (Ke): typically from CAPM Ke = rRF + β(MRP) (or DDM if dividends are stable).
  • Weights: prefer market value weights (market cap for E; market value of debt if available).

Monte Carlo (why we do it): WACC is sensitive to uncertain inputs. Simulation gives a distribution (mean, P5/P50/P95), not just one number.

  • Main drivers: YTM (rates), tax rate, β, market risk premium, and capital structure weights.
  • Interpret tails: P95 WACC = “bad” discount-rate scenario; it pushes PVs down more.
  • Bond price link: yields ↑ ⇒ bond prices ↓ (use the same simulated yields to price the bond each trial).

Common traps: mixing % vs decimals, forgetting the (1−T) tax shield, using wrong semiannual inputs, and using inconsistent weights (book vs market).

Chapter 11 Project Evaluation 3/5 • 3/10 • 3/12

Chapter website + slide deck.

Open Chapter 11 Website Slides (PPTX)
Brief Notes (NPV, IRR, MIRR, Crossover Rate) (click to expand)

Goal: decide whether a project adds value and choose the best project when projects compete for the same capital.

  • Net Present Value (NPV): the gold-standard decision rule. NPV = Σ [CFt / (1 + r)t] − Initial Cost. If NPV > 0, the project increases shareholder wealth.
  • Internal Rate of Return (IRR): the discount rate that makes NPV = 0. Accept if IRR > required return, but IRR can mislead when cash flows are nonnormal or projects are mutually exclusive.
  • Modified IRR (MIRR): fixes key IRR problems by assuming positive cash flows are reinvested at the cost of capital, not at IRR. MIRR gives only one solution and is easier to interpret.
  • Payback Period: how long it takes to recover the initial investment. Useful for liquidity/risk intuition, but it ignores time value and cash flows after payback.
  • Discounted Payback: improves payback by discounting cash flows first, but still ignores later cash flows after the cutoff.
  • Profitability Index (PI): PI = PV of future cash flows / Initial Cost. Helpful under capital rationing, but for normal decisions NPV is still preferred.

When rankings conflict:

  • Independent projects: accept every project with NPV > 0.
  • Mutually exclusive projects: choose the project with the higher NPV, even if it has the lower IRR.
  • Why conflict happens: differences in scale (project size) or timing (early vs late cash flows).

Crossover rate:

  • The crossover rate is the discount rate where two projects have the same NPV.
  • To find it, subtract one project’s cash flows from the other to form an incremental cash flow stream, then compute the IRR of the difference.
  • If the required return is below the crossover rate, one project is preferred; if it is above, the other may be preferred.

Excel reminders:

  • =NPV(rate, CF1:CFn) + CF0  (do not include initial cost inside the NPV range)
  • =IRR(CF0:CFn)
  • =MIRR(CF0:CFn, finance_rate, reinvest_rate)

Common exam traps: forgetting to subtract the initial investment in NPV, choosing the higher IRR instead of the higher NPV for mutually exclusive projects, missing the possibility of multiple IRRs with nonnormal cash flows, and confusing MIRR with IRR.

DCF Demo DCF - Amazon Valuation Example 10 Extra Points 3/24, due with final

Simple extra-credit opportunity: build a basic Amazon DCF in Excel and submit one Excel file showing your valuation steps clearly.

Open Amazon DCF Demo Chapter 12 Website
Extra Credit Instructions (click to expand)

Extra Credit Opportunity: Up to 10 extra points.

  • Submit one Excel file only.
  • Use a simple DCF valuation for Amazon.
  • Show your assumptions clearly: FCF, growth, WACC, terminal growth, shares outstanding.
  • Show your forecast, present value, terminal value, enterprise value, equity value, and implied value per share.
  • Neat layout and clearly labeled steps matter more than “perfect” forecasting.

This is a learning exercise to help you understand how valuation works in Excel.

Chapters 3 & 12 DCF - Cash Flow Estimation 3/26 & 3/31

Open Chapter 12 Website Slides (PPTX)
Brief Notes (Cash Flow Estimation + Monte Carlo) (click to expand)

Goal: estimate a project’s incremental cash flows correctly and then evaluate the project with NPV, not accounting income.

  • Main idea: use cash flows, not net income. A good project may lower accounting income in one year but still create value if its cash flows are strong.
  • Incremental cash flows only: include only the cash flows that occur because the project is accepted. Ignore sunk costs.
  • Opportunity costs count: if the project uses land, equipment, or space that could be sold or used elsewhere, that lost value is a real project cost.
  • Externalities matter: if a new product hurts sales of an existing product, that lost contribution is part of the analysis (cannibalization).
  • Financing costs are not operating cash flows: do not subtract interest expense in project cash flow estimation, because financing is already reflected in the discount rate / WACC.

Project cash flow logic:

  • Initial outlay (Year 0): equipment + shipping + installation + required NOWC.
  • Operating cash flows (Years 1, 2, ...): typically built from EBIT(1 − T) + Depreciation.
  • Terminal cash flow: add recovery of NOWC and any after-tax salvage value.

Key formula connection to FCF:

  • For a project, cash flow is basically project-level FCF: NOPAT + Depreciation − CapEx − ΔNOWC + After-tax Salvage
  • This is why Chapter 12 connects directly to Chapter 3.

Monte Carlo analysis:

  • Instead of using only one base-case NPV, Monte Carlo lets key inputs vary randomly (for example, units sold and sales price).
  • The result is a distribution of NPV, not just one number.
  • Students should report: mean NPV, standard deviation, and probability that NPV < 0.

Common exam traps: including sunk costs, forgetting opportunity costs, subtracting interest expense, missing the recovery of NOWC in the final year, and confusing accounting profit with cash flow.

Chapter 19 Options 4/9 • 4/14 • Due with Final

Chapter 19 is organized into four parts: Call / Put Payoff, Binomial, Black-Scholes, and a Chapter 19 case-study page that holds the Excel file and class video together.

1) Call / Put Payoff 2) Binomial Model 3) Black-Scholes 4) Chapter 19 Case Study Slides (PPTX)
Chapter 19 Notes (click to expand)

The fourth item opens a Chapter 19 case-study page that keeps the Excel file and class video together in one place.

  • Part 1: Call and Put Option Payoff
  • Part 2: Binomial Option Model
  • Part 3: Black-Scholes Option Model
  • Part 4: Chapter 19 Case Study page (Excel file + class video)

Open the Chapter 19 case-study page, watch the video, complete the Excel file, and submit it with the final.

Chapter 15 Dividends 4/16

Open Chapter 15 Website Slides (PPTX)

Chapter 21 Merger & Acquisition 4/21

Open Chapter 21 Website Slides (PPTX)

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