Brief contents Topics covered in the book xxi Introduction to the book xxiii Acknowledgements xxix Part 1 Introduction 1 The financial world 2 Part 2 The investment decision 49 Project appraisal: net present value and internal rate of return 50Project appraisal: cash flow and applications 89The decision-making process for investment appraisal 125Project appraisal: capital rationing, taxation and inflation 151 Part 3 Risk and return 173 Risk and project appraisal 174Portfolio theory 222The Capital Asset Pricing Model and multi-factor models 268 Part 4 Sources of finance 327 Stock markets 328Raising equity capital 365Long-term debt finance 422Short- and medium-term finance, treasury and working capital management 474Stock market efficiency 542 Part 5 Corporate value 611 Value-based management 612Value-creation metrics 658The cost of capital 704Valuing shares 738Capital structure 787Dividend policy 840Mergers 868 Part 6 Managing risk 927 Derivatives 928Managing exchange-rate risk 974 Appendices A:1 Future value of £1 at compound interest A:2Present value of £1 at compound interest A:3Present value of an annuity of £1 at compound interest A:4Future value of an annuity of £1 at compound interest A:5Areas under the standardised normal distribution A:6Answers to the mathematical tools exercises in Chapter 2, Appendix 2.1 A:7 Glossary G:1 Bibliography B:1 Index I:1

"The book combines academic rigour (in the explanation of theory) with practical application (explaining how companies apply theory in real life). There are lots of numerical examples to help with understanding of the concepts covered." Dr Rob Jones, Newcastle University Business School   The sixth edition of this highly respected text is comprehensive yet accessible, with real-world case studies to ground you in the application of important concepts. Written with authority by authors steeped in the financial world, the book offers a comprehensive survey of the theory and practice of corporate finance for anyone studying the topic by itself or within business, accounting, finance, banking or economics courses, teaching you how to make informed, successful financial decisions that are crucial for a career in business. It explores topics such as investment appraisal, risk and return, sources of finance, and risk management, including derivatives, and gives a unique treatment of corporate value. Key features Financial techniques are illustrated in practical terms, using clear accessible language. New Financial Times articles help you see the relevance of the theory to the real world Finance is presented as a dynamic subject that is open to theoretical re-evaluation  Extensive range of examples and case studies, with statistics and data ranging from the number of corporate mergers to the default rates on corporate bonds Easy-to-follow mathematical explanations Glen Arnold runs an investment fund and previously held positions as professor of finance and professor of investing. In addition to the textbook Modern Financial Markets and Institutions he has authored leading investment and banking books including The Financial Times Guide to Investment, The FT Guide to Banking and The FT Guide to Value Investing.    Deborah Lewis is a Senior Teaching Fellow at the University of Bath. As Director of Studies for the Bath MBA programme, which features in the top 100 of the FT Global MBA 2018 Ranking, she ensures the material is useful for both the student and the practitioner. Deb’s previous commercial experience allows her to blend academic theory with professional application.    MyLab Finance Join over 10 million students benefiting from Pearson MyLabs. This title can be supported by MyLab Finance, an online homework and tutorial system designed to test and build your understanding. MyLab Finance provides a personalised approach, with instant feedback and numerous additional resources to support your learning. A personalised study plan Usable either following chapter-by-chapter structure or by learning objective Worked solutions showing you how to solve difficult problems Limitless opportunities to practise Use the power of MyLab Finance to accelerate your learning. You need both an access card and a course ID to access MyLab Finance: Is your lecturer using MyLab Finance? Ask your lecturer for your course ID. Has an access card been included with the book? Check the inside back cover of the book.   If you have a course ID but no access card, go to http://www.pearson.com/mylab/finance to buy access.

Hallmark Features of This Title Clear and accessible structure and language that facilitates your students' learning. The clear learning objectives and introduction at the beginning of each chapter, help you place your teaching into context and set learning expectations for your students.Financial techniques are illustrated in practical terms, using accessible language.Comprehensive lists of references and websites, further reading, glossary and appendices are excellent additional learning resources for your students. Content that enables individual reflection and group discussion in class. Presentation of finance as a dynamic subject that is open to theoretical re-evaluation.Self-review questions based on the main elements of the topic prompt reflection and are ideal for revision.

Worked examples demonstrate new, updated techniques throughout the text, presenting problems for discussion with detailed answers provided.Content thoroughly updated with new Financial Times articles helps your students see the relevance between theory and the real world.New examples and case studies are presented throughout the text, discussing key topics in the world of business.Revised end-of-chapter materials with solutions are presented, reflecting current developments in the field.New skills are fully explained and illustrated in the Mathematical Explanations sections, to facilitate your students' understanding of complex learning materials.New key concepts along with any jargon and equations are now simplified and summarised to facilitate your students' comprehension and learning.