FIN509 – Fall 2026

FIN-509-101W: Essentials of Finance

Fall 2026 — Second Half • DCOB 117 or live stream • 8-week class

Live class: Tuesdays 6:00–8:50 PM • First class: Tuesday, 10/06/2026 • Course weeks: Week of 10/05/2026 through final exam week of 11/24/2026

Syllabus & Policies — Quick Summary

📄 Official, detailed syllabus (grading, policies, resources): Simple Syllabus — FIN 509 Fall 2026

Course Info

FIN-509-101W: Essentials of Finance covers corporate finance, time value of money, risk & return, capital budgeting, and valuation topics. This Fall 2026 section is an 8-week course with attendance in DCOB 117 or by live stream.

• 📄 Fall 2026 Syllabus (Word)
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📚 Chapters & Topics

Choose a large button to open a chapter website. Expand the chapter summaries below for key concepts and Excel formulas.

• 📘 Chapter 5: Time Value of Money – Part 1

  Key knowledge: move money across time using compounding and discounting.

  • PV Present value — what future money is worth today.
  • FV Future value — what today’s money grows to later.
  • Rate Interest rate or discount rate per period.
  • NPER Number of periods.
  • Timeline Put each cash flow in the right period before using Excel.

  Excel focus: =PV(), =FV(), =RATE(), =NPER()

  Open Chapter 5 website
• 📘 Chapter 6: Time Value of Money – Part 2 / DCF Valuation

  Key knowledge: add payments and multiple cash flows for real finance decisions.

  • PV Discount future cash flows back to today.
  • FV Compound cash flows forward.
  • Rate Find the return or discount rate.
  • NPER Find how many periods are needed.
  • PMT Equal periodic payment for annuities and loans.
  • APR / EAR APR is the stated annual rate; EAR includes compounding. In Excel, use =EFFECT(APR, m).
  • NPV Present value of future cash flows minus initial cost.
  • NFV Future value of project cash flows at the end date.

  Excel focus: =PMT(), =NPV(rate,cashflows)+initial cash flow, EAR=(1+APR/m)^m-1, =EFFECT(nominal_rate,npery)

  Open Chapter 6 website
• 📘 Chapter 7: Bond Valuation

  Key knowledge: Learn how bonds are valued, how bond prices are determined, and why bond prices move opposite to market interest rates.

  • Par Value The face value of the bond that is repaid at maturity (typically $1,000).
  • Coupon Rate The annual interest rate stated on the bond when it is issued.
  • Coupon Payment The dollar interest payment received each period.
    Coupon Payment = Coupon Rate × Par Value
  • Yield to Maturity (YTM) The market's required rate of return on the bond based on its current price.
  • Maturity The number of years remaining until the bond repays its par value.
  • Bond Price The present value of all future coupon payments plus the present value of the par value.
  • Premium Bond Coupon Rate > YTM → Bond Price > Par Value
  • Discount Bond Coupon Rate < YTM → Bond Price < Par Value
  • Par Bond Coupon Rate = YTM → Bond Price = Par Value
  • Price–Yield Relationship Bond prices move in the opposite direction of market interest rates.
  • Interest Rate Risk Longer-term bonds experience larger price changes when interest rates change.

  Excel focus:
  
  • =PV() — Bond price from future cash flows
  • =RATE() — Yield to maturity (YTM)
  • Build bond valuation models using discounted cash flows and financial timelines.

  Open Chapter 7 website
• 📘 Chapter 8: Stock Valuation

  Key knowledge: Learn how a stock’s value is determined from expected future dividends, growth, and the investor’s required return.

  • Stock Value The present value of the future cash flows expected by shareholders.
  • D₀ The most recent dividend that has already been paid.
  • D₁ The dividend expected next year: D₁ = D₀(1 + g)
  • Required Return The return investors require for the stock’s risk, represented by r.
  • Growth Rate The expected long-run dividend growth rate, represented by g.
  • Gordon Model Values a stock whose dividends grow at a constant rate forever: P₀ = D₁ / (r − g)
  • Required Return Expected return equals dividend yield plus growth: r = D₁ / P₀ + g
  • Dividend Yield The expected cash dividend relative to the current stock price: D₁ / P₀
  • Two-Stage Growth Forecast the early dividends individually, calculate the terminal stock price, and discount all cash flows back to today.
  • Important Condition The constant-growth model requires r > g.

  Major equations:
  • D₁ = D₀(1 + g) — Next expected dividend
  • P₀ = D₁ / (r − g) — Constant-growth stock value
  • P₀ = D₀(1 + g) / (r − g) — Price using the most recent dividend
  • r = D₁ / P₀ + g — Required return
  • g = r − D₁ / P₀ — Implied dividend growth rate

  Open Chapter 8 website
• 📘 Chapter 9: Capital Budgeting

  Key knowledge: Evaluate long-term investments by comparing project cash flows, required returns, and value creation.

  • Net Present Value Measures how much value a project adds today. Accept a project when NPV > 0.
  • Internal Rate of Return The discount rate that makes the project’s NPV equal to zero.
  • Modified IRR Uses realistic financing and reinvestment rates and avoids some problems associated with IRR.
  • Profitability Index Measures value created per dollar of initial investment. Accept when PI > 1.
  • Payback Period The time required to recover the initial investment.
  • Discounted Payback The time required to recover the investment using discounted cash flows.
  • Project Selection For mutually exclusive projects, choose the project with the higher positive NPV.

  Major equations and Excel:
  • NPV = Σ[CFₜ / (1 + r)ᵗ] — Present value of project cash flows
  • =NPV(rate, CF1:CFn) + CF0 — Excel NPV
  • NPV(IRR) = 0 — Definition of IRR
  • =IRR(CF0:CFn) — Excel IRR
  • =MIRR(CF0:CFn, finance_rate, reinvest_rate)
  • PI = 1 + NPV / |CF0| — Profitability index

  Open Chapter 9 website
• 📘 Chapter 14: Weighted Average Cost of Capital

  Key knowledge: Calculate the firm’s overall required return using the market-value costs of debt and equity.

  • WACC The blended required return paid to the firm’s debt and equity investors.
  • Market-Value Weights Debt and equity should be weighted using market values rather than book values.
  • Cost of Debt The current yield required by lenders, usually estimated from the bond’s yield to maturity.
  • Tax Shield Interest is generally tax deductible, so WACC uses the after-tax cost of debt.
  • Cost of Equity Can be estimated using CAPM or the constant-growth dividend model.
  • Hurdle Rate Projects earning more than WACC generally create value; projects earning less than WACC generally destroy value.

  Major equations:
  • WACC = wD × Kd(1 − T) + wE × Ke
  • wD = D / (D + E) — Debt weight
  • wE = E / (D + E) — Equity weight
  • Kd after tax = Kd × (1 − T)
  • Ke = Rf + β(Rm − Rf) — CAPM cost of equity
  • Ke = D₁ / P₀ + g — Dividend-growth cost of equity
  • =RATE() — Estimate bond yield and cost of debt

  Open Chapter 14 website
• 📘 Chapter 13: Risk and Return

  Key knowledge: Measure investment return and risk, understand diversification, and determine required return using CAPM.

  • Holding-Period Return Total return from the price change and any dividend received.
  • Expected Return The probability-weighted average of possible investment returns.
  • Variance Measures the dispersion of possible returns around the expected return.
  • Standard Deviation Measures the total volatility or stand-alone risk of an investment.
  • Correlation Measures how two investments move together, from −1 to +1.
  • Diversification Combining assets with lower correlation can reduce portfolio risk.
  • Beta Measures a stock’s sensitivity to market movements and its systematic risk.
  • CAPM Determines the required return based on the risk-free rate, beta, and market risk premium.

  Major equations and Excel:
  • HPR = (P₁ − P₀ + D₁) / P₀
  • E(R) = Σ[pᵢ × Rᵢ]
  • Variance = Σ[pᵢ(Rᵢ − E(R))²]
  • σ = √Variance
  • E(Rp) = w₁E(R₁) + w₂E(R₂)
  • CAPM: E(R) = Rf + β[E(Rm) − Rf]
  • =SUMPRODUCT(probabilities, returns)
  • =SQRT(variance)

  Open Chapter 13 website
• 📘 Chapters 2 and 3: Financial Statements and Cash Flow — Investor Bible

  Key knowledge: Read the three major financial statements, evaluate a company’s financial position and performance, and convert accounting information into the cash-flow measures used in corporate finance and valuation.

  • Balance Sheet A snapshot of the company’s assets, liabilities, and shareholders’ equity at a particular date.
  • Income Statement Shows how revenue becomes operating income and net income over a period.
  • Cash Flow Statement Explains cash generated and used through operating, investing, and financing activities.
  • Liquidity The company’s ability to meet its short-term obligations.
  • Leverage The extent to which the company uses debt financing.
  • Margins Show how much of each sales dollar remains after different levels of expenses.
  • Earnings Quality Compare accounting income with operating cash flow to determine whether reported profits are supported by cash.
  • Net Working Capital The difference between current assets and current liabilities.
  • Operating Cash Flow Cash generated by the company’s normal business operations.
  • Net Capital Spending The net investment made in long-term operating assets.
  • Cash Flow from Assets Cash generated by the company’s assets after investments in fixed assets and working capital.
  • Cash Flow to Creditors Interest paid minus net new borrowing.
  • Cash Flow to Stockholders Dividends paid minus net new equity raised.
  • Free Cash Flow Cash available to the company’s investors after required operating investments.

  Major equations:
  • Assets = Liabilities + Equity
  • Gross Profit = Sales − Cost of Goods Sold
  • Gross Margin = Gross Profit / Sales
  • Operating Margin = EBIT / Sales
  • Net Margin = Net Income / Sales
  • Current Ratio = Current Assets / Current Liabilities
  • Debt-to-Equity = Total Debt / Equity
  • NWC = Current Assets − Current Liabilities
  • Change in NWC = Ending NWC − Beginning NWC
  • OCF = EBIT + Depreciation − Taxes
  • Net Capital Spending = Ending NFA − Beginning NFA + Depreciation
  • Cash Flow from Assets = OCF − Net Capital Spending − Change in NWC
  • Cash Flow from Assets = Cash Flow to Creditors + Cash Flow to Stockholders

  Open Chapters 2 and 3 website

Weekly Schedule — Fall 2026

Course weeks: Week of 10/05/2026 through final exam week of 11/24/2026. First live class: Tuesday 10/06/2026. This is an 8-week course with seven instructional meetings and a final exam week. Tuesday instructional meetings: 10/06, 10/13, 10/20, 10/27, 11/03, 11/10, and 11/17. Live class meets Tuesdays 6:00–8:50 pm in DCOB 117.

Past Semester

• 📁 FIN509 — Summer 2025 Website

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