Corporate Finance_3rd Edition_Pearson

【实例简介】
Corporate Finanace, an English book by Pearson Berk Jonat
To Rebecca, Natasha, and Hannah, for the love and for being there -J B To Kaui, Pono, Koa, and Kai, for all the love and laughter -P D Editor in Chief: Donna battista Media Director: Susan Schoenberg Acquisitions Editor: Katie Rowland Content Lead, My FinanceLab: Miguel Leonarte Executive Development Editor: Rebecca Ferris-Caruso Executive Media Producer: Melissa Honig Editorial Project Manager: Emily Biberger Project management and Text Design Managing editor: Jeff Holcomb illian Hall, The Aardvark Group Senior Production Project Manager: Nancy Freihofer Composition and Artwork: Laserword Senior Manufacturing Buyer: Carol Melville Printer/Binder: R.R. Donnelley/Jefferson City Cover Designer: Jonathan Boylan Cover Printer: Lehigh Phoenix Cover Photo: Nikreates/Alamy Text Font: Adobe Garamond Credits and acknowledgments borrowed from other sources and reproduced, with permission, in this textbook appear on the appropriate page within text and on this copyright page Credits: Cover: Sculpture in photo: Detail of Flamingo(1973), Alexander Calder. Installed in Federal Plaza, Chicago. Sheet metal and paint, 1615. x 1828.8 x 731.5 cm. Copyright C 2013 Calder Foundation, New York/Artists Rights Society (ARS), New York. Photo by Nikreates/Alamy, p. xxii: Author photo: Nancy Warner Microsoft and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published as part of the services for any purpose. All such documents and related graphics are providedas is"without warranty of any kind. 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To obtain permission(s)to use material from this work, please submit a written request to Pearson Education, Inc, Rights and Contracts Department, 501 Boylston Street, Suite900,Boston,Ma02116;faxyourrequestto617671-3447,ore-mailatwww.pearsoned.com/legal/permissions.htm Many of the designations by manufacturers and sellers to distinguish their products are claimed as trademarks. Where those designations appear in this book, and the publisher was aware of a trademark claim, the designations have been printed in initial caps or all caps Library of Congress Cataloging-in-Publication Data Berk, Jonathan B, 1962 Corporate finance/ Jonathan Berk, Peter DeMarzo.--3rd ed cm ISBN978-0-13-299247-3 1. Corporations--Finance I. DeMarzo, Peter M. II. Title HG4026.B462014 658.15-dc22 10987654321 PEARSON ISBN13:978-0-13-299247-3 www.pearsonhighered.com ISBN 10 0-13299247-7 The Pearson Series in Finance Bekaert/Hodrick Goldsmith McDonald International Financial Management onsumer economics: Issues and behaviors Fundamentals of Derivatives Markets Berk/Demarzo Mishkin/eakins rp te finance The Inefficient Stock Market: What Pays Financial markets and institutions Berk/DeMarzo Offand Wh Moffett/Stonehill/Eiteman Corporate Finance: The Core Haugen Fundamentals of Multinational finance Berk/De Marzo/harford The New Finance: Overreaction singe Fundamentals of Corporate Finai Complexity and uniqueness ychology of investing Brooks Holden Ormiston/fraser Financial Management: Core Concepts Excel Modeling in Corpe orate finance Holden Understanding Financial Statements Copeland/Weston/Shastri Pe ennacchl Financial Theory and Corporate Policy Excel Modeling in investments Dorfman/Cather Theory of Asset Pricing Introduction to Risk management International Banking: Text and cases Reda and insurance Principles of Risk Management Eiteman/Stonehill/ Moffett Fundamentals of Futures and Options Marke and insurance Multinational Business finance Hull Fabozzi Options, Futures, and Other Derivatives Performing Financial Studies Bond Markets: Analysis and strategies Hull A Methodological Cookbook Fabozzi/ Modigliani Risk management and Financial Institutions Smart/Gitman/Joehnk Capital Markets: Institutions and Instruments Keown Fundamentals of investing Zzi/Modigliani/Jones Personal Finance: Turning Money into Wealth* Solnik/McLeavey Foundations of financial Markets Keown/Martin/Petty Global investments and institutions Foundations of Finance: The logic Stretcher/Michael and Practice of Financial management Cases in Financial management Financial Management for Public, Health Kim/Nofsinger town artin and Not-for-Profit organizations Corporate governane Financial Management: Principles Fr Mad nd applic ersonal上 inance Personal finance Titman/martin Gitman/zutter Marthinsen Valuation The art and science Principles of Managerial finance* Risk Takers: Uses and Abuses of financial of Corporate Investment Decisions Gitman/zutter Weston/Mitchel/ Mulherin Principles of managerial finance-Brief McDonald Takeovers, Restructuring, and Corporate edition Derivatives markets Governance denotesMyfinanceLabtitlesLogontowww.myfinancelab.comtolearnmore Brief contents PART 1 Chapter 1 The Corporation 2 INTRODUCTION Chapter 2 Introduction to Financial Statement Analysis 21 Chapter 3 Financial Decision Making and the Law of one Price 59 PART 2 Chapter 4 The Time Value of Money96 TIME MONEY Chapter 5 Interest Rates( 141 AND INTEREST RATES Chapter 6 Valuing Bonds 169 PART 3 Chapter 7 Investment Decision Rules 206 VALUING PROJECTS Chapter 8 Fundamentals of Capital Budgeting 233 AND FIRMS Chapter 9 valuing stocks 271 PART 4 Chapter 10 Capital Markets and the Pricing of risk 312 RISK AND RETURN Chapter 11 Optimal Portfolio Choice and the Capital Asset Pricing Model 351 Chapter 12 Estimating the Cost of capital 400 Chapter 13 Investor Behavior and Capital Market Efficiency 437 PART 5 Chapter 14 Capital structure in a perfect Market 478 CAPITAL STRUCTURE Chapter 15 Debt and T axes 508 Chapter 16 Financial Distress, Managerial Incentives and Information 539 Chapter 17 Payout Policy 584 PART 6 Chapter 18 Capital Budgeting and Valuation with Leverage 626 ADVANCED VALUATION Chapter 19 Valuation and Financial Modeling: A Case Study 674 PART 7 Chapter 20 Financial Options 706 OPTIONS Chapter 21 Option valuation 738 Chapter 22 Real Options 773 PaRT 8 Chapter 23 Raising Equity Capital 806 LONG-TERM FINANCING Chapter 24 Debt Financing 836 Chapter 25 Leasing 859 PaRT 9 Chapter 26 Working Capital Management 886 SHORT-TERM FINANCING Chapter 27 Short-Term Financial Planning 908 PART 10 Chapter 28 Mergers and Acquisitions 930 SPECIAL TOPICS Chapter 29 Corporate Governance 961 Chapter 30 Risk Management 985 Chapter 31 International Corporate Finance 1026 Detailed Contents PART 1 INTRODUCTION International Financial Reporting Standards 22 Chapter 1 The Corporation 2 INTERVIEW with Sue Frieden 23 Types of Financial Statements 24 1.1 The Four Types of Firms 3 Sole proprietorships 3 2.2 The balance sheet 24 Partnerships 4 Assets 25 Limited Liability Companies 5 Liabilities 26 Corporations 5 Stockholders Equity 27 Tax Implications for Corporate Entities 6 Market∨alue∨ ersus book value27 Corporate Taxation Around the Enterprise Value 28 World 7 2.3 The Income statement 28 2 Ownership Versus Control of Earnings Calculations 29 Corporations 7 The Corporate Management Team 7 2.4 The statement of cash flows 30 INTERVIEW with david viniar 8 Operating Activity 31 The Financial Manager 9 Investment Activity 32 GLOBAL FINANCIAL CRISIS Financing Activity 32 The Dodd-Frank Act 10 25 Other Financial statement The goal of the firm 10 nformation 33 The Firm and society 11 Statement of Stockholders Equity 33 Ethics and incentives within Management Discussion and Corporations 11 Analysis 34 GLOBAL FINANCIAL CRISIS Notes to the financia The Dodd-Frank Act on Corporate Statements 34 Compensation and Governance 12 Citizens United v Federal Election 2.6 Financial Statement Analysis 35 Commission 12 Profitability Ratios 35 Airlines in Bankruptcy 14 Liquidity Ratios 36 1.3 The stock market 14 Working Capital Ratios 37 Primary and Secondary Stock Markets 15 Interest Coverage Ratios 38 The Largest Stock Markets 15 Leverage Ratios 39 INTERVIEW with Jean-Francois aluation ratios 41 Theodore 16 COMMON MISTAKE Mismatched NYSE 16 Ratios 41 NASDAQ 17 Operating returns 42 The DuPont Identity 44 MyFinance Lab17■ Key Terms18■ Further Reading 18 Problems 19 2.7 Financial Reporting in Practice 46 Chapter 2 Introduction to Financial Enron 46 Statement Analysis 21 Worldcom 46 Sarbanes-Oxley Act 47 2.1 Firms' Disclosure of financia GLOBAL FINANCIAL CRISIS Information 22 Bernard Madoff's ponzi Preparation of Financial Scheme 48 Statements 22 Dodd-Frank Act 48 Contents MyFinance Lab49■ Key Terms50■ PART 2 TIME MONEY AND Further Reading 51 Problems 51- NTEREST RATES Data Case 58 Chapter 4 The Time Value of Money 96 Chapter 3 Financial Decision Making 4.1 The Timeline 97 and the Law of one price 59 4.2 The Three rules of time travel 98 3.1 Valuing decisions 60 Rule 1: Comparing and Combining Values Analyzing Costs and Benefits 60 Rule 2: Moving Cash Flows Forward in Time 99 Using Market Prices to Determine Cash Values 61 Rule 3: Moving Cash Flows Back n Time 100 When Competitive Market Prices Are not available 63 Rule of 72 101 Applying the Rules of Time Travel 102 3.2 Interest rates and the time value of Money 63 4.3 Valuing a Stream of Cash Flows 104 The Time value of Money 63 4.4 Calculating the Net Present Value 107 The Interest Rate: An Exchange Rate USING EXCEL Calculating Present Across time 6 Values in excel 108 3.3 Present value and the npv decision 4.5 Perpetuities and Annuities 109 Rule 66 Perpetuities 109 Net Present Value 66 Historical Examples of Perpetuities 110 The ne∨ Decision rule67 COMMON MISTAKE Discounting One Too Many Times 112 NP∨ and cash needs69 Annuities 112 3.4 Arbitrage and the Law of one Growing Cash Flows 115 Price 70 4.6 Using an Annuity Spreadsheet or Arbitrage 70 Calculator 120 ■ NASDAQ SOES Bandits71 4.7 Non-Annual Cash Flows 122 Law of one price 71 4.8 Solving for the Cash Payments 123 3.5 No-Arbitrage and Security Prices 72 4. 9 The Internal Rate of return 126 Valuing a Security with the Law of one USING EXCEL Excels IRR Price 72 Function 129 An old Joke 72 MyFinance Lab130■ Key Terms131■ The NPV of Trading Securities and Firm Further Reading 132 Problems 132 Decision Making 75 Data case 137 Valuing a portfolio 76 Appendix Solving for the Number Stock Index Arbitrage 77 of Periods 139 GLOBAL FINANCIAL CRISIS Problems 140 Liquidity and the Informational Role of prices 78 Where Do We Go from here? 78 Chapter 5 Interest Rates 141 My FinanceLab79■ Key Terms80■ 5.1 Interest Rate Quotes and Further Reading 80 Problems 81 Adjustments 142 Appendix The Price of Risk 85 The effective annual rate 142 COMMON MISTAKE Using the Arbitrage with Transactions Costs 90 rong Discount Rate in the Annuity MyFinance Lab92■ Key Terms92■ Formula 143 Problems 92 Annual Percentage Rates 144 tents 5.2 Application: Discount Rates and Valuing a Coupon Bond Using Loans 146 Zero-Coupon Yields 182 GLOBAL FINANCIAL CRISIS Teaser Coupon Bond Yields 183 Rates and Subprime Loans 148 Treasury Yield Curves 184 5.3 The determinants of interest 6.4 Corporate Bonds 184 Rates 147 Corporate Bond Yields 185 Inflation and Real Versus Nominal Are Treasuries Really Default-Free Rates 148 Securities? 185 Investment and Interest rate Bond Ratings 187 Policy 149 Corporate Yield Curves 188 The yield curve and discount rates 150 COMMON MISTAKE Using the 6.5S gn Bonds 188 Annuity Formula When Discount Rates GLOBAL FINANCIAL CRISIS The Vary by maturity 152 Credit crisis and bond yields 189 The Yield Curve and the economy 152 GLOBAL FINANCIAL CRISIS INTERVIEW with Kevin m. Warsh 154 European Sovereign Debt Yields A Puzzle 191 5. 4 Risk and Taxes 155 INTERVIEW with Carmen Risk and interest rates 156 M. Reinhart 192 After-Tax Interest Rates 157 MyFinance Lab193■ Key Terms194■ 5.5 The Opportunity Cost of Capital 158 Further Reading 194 Problems 195 B Data Case 199 COMMON MISTAKE States Dig a $3 Trillion Hole by Discounting at the Appendix Forward Interest Rates 201 Wrong rate 159 Key terms 204 Problems 204 MyFinanceLab 160 Key Terms 161 Further Reading 161 Problems 161 Appendix Continuous Rates and Cash Flows 167 PART 3 VALUING PROJECTS AND FIRMS Chapter 6 Valuing Bonds 169 Chapter 7 Investment Decision Rules 206 6.1 Bond cash flows Prices, and 7.1 NPV and stand-Alone Yields 170 Projects 207 Bond Terminology 170 Zero-Coupon Bonds 170 Applying the NPv rule 207 GLOBAL FINANCIAL CRISIS The NPv Profile and Irr 207 Pure Discount Bonds Trading at a A| ternative ru|es∨ ersus the ne∨ Premium 172 Rule 208 Coupon Bonds 173 INTERVIEW with Dick Grannis 209 6.2 Dynamic Behavior of Bond 7.2 The Internal rate of return Prices 175 Rule 210 Discounts and premiums 175 Applying the IRR Rule 210 Time and Bond Prices 176 Pitfall #1: Delayed Investments 210 Interest Rate Changes and Bond Pitfall #2 Multiple IRRs 211 Prices 178 Pitfall#3: Nonexistent IRR 213 Clean and Dirty Prices for Coupon COMMON MISTAKE IRR Versus the Bonds 179 RR Rule 213 6.3 The Yield Curve and bond 7.3 The Payback Rule 214 Arbitrage 181 Applying the Payback Rule 214 Replicating a Coupon Bond 18 Payback Rule Pitfalls in Practice 215 Content Why Do rules other Than the NPV Comparing Free Cash Flows for Cisco's Rule Persist? 216 Alternatives 247 7.4 Choosing Between Projects 216 8.4 Further Adjustments to Free Cash NPV Rule and Mutually EXclusive Flow 248 Investments 216 GLOBAL FINANCIAL CRISIS The IRR Rule and mutually exclusive American Recovery and Reinvestment Investments 217 Act of 2009 252 The Incremental irr 218 8.5 Analyzing the Project 252 When Can Returns be Break-Even Analysis 252 Compared? 219 COMMON MISTAKE IRR and Project Sensitivity Analysis 253 Financing 221 INTERVIEW with David Holland 255 Scenario Analysis 25 7.5 Project Selection with Resource USING EXCEL Project Analysis Constraints 221 Using Excel 257 Evaluating Projects with Different MyFinanceLab258■ Key Terms260■ Resource Requirements 221 Further Reading260■ Problems260■ Profitability Index 222 Data case 267 Shortcomings of the Profitability dex 224 Appendix MACRS Depreciation 269 MyFinanceLab224■ Key Terms225■ Further Reading 225 Problems 225 B Chapter 9 Valuing Stocks 271 Data Case 231 9.1 The Dividend-Discount Model 272 Appendix Computing the NPv A One-Year Investor 272 Profile Using Excel's Data Dividend Yields, Capital gains Table function 232 Returns 273 The Mechanics of a short sale 274 A Multiyear Investor 275 Chapter 8 Fundamentals of capital The Dividend-Discount Model Equation 276 Budgeting 233 9.2 Applying the Dividend-Discor 8.1 Forecasting Earnings 234 Model 276 Revenue and cost estimates 234 Constant Dividend growth 276 Incremental earnings Forecast 235 Dividends versus Investment and Indirect Effects on Incremental Growth 277 Earnings 237 John Burr Williams Theory of COMMON MISTAKE The Opportunity Investment value 278 Cost of an idle asset 238 Changing growth Rates 280 Sunk Costs and Incremental Limitations of the dividend-Discount arnings Mode 282 The Sunk Cost Fallacy 239 9.3 Total Payout and Free Cash Flow Real-World Complexities 240 Valuation models 282 8.2 Determining free cash Flow and Share repurchases and the Total Payout NP241 Model 282 Calculating Free Cash Flow from The discounted free cash Flow model 284 Earnings 241 9. 4 Valuation Based on Comparable Calculating Free Cash Flow Directly 243 Firms 288 Calculating the NP∨244 Valuation Multiples 288 USING EXCEL Capital Budgeting Limitations of Multiples 290 Using a Spreadsheet Program 245 Comparison with Discounted Cash Flow 8.3 Choosing Among Alternatives 246 Methods 291 Evaluating Manufacturing Stock Valuation Techniques: The Final Alternatives 246 Word 292 Contents INTERVIEW with Douglas Kehring 293 No Arbitrage and the Risk Premium 33 9.5 Information, Competition and GLOBAL FINANCIAL CRISIS Stock Prices 294 Diversification Benefits During Market Information in stock prices 294 Crashes 335 Competition and efficient Markets 295 COMMON MISTAKE A Fallacy of Lessons for Investors and Corporate Long-Run Diversification 336 Managers 297 Kenneth Cole Productions-What 10.7 Measuring Systematic Risk 337 Happened? 299 Identifying Systematic Risk: The Market Portfolio 337 The Efficient Markets Hypothesis Versus No Arbitrage 300 Sensitivity to Systematic Risk: Beta 337 MyFinanceLab300■ Key Terms302■ 10.8 Beta and the Cost of Capital 340 Further Reading 302 a Problems 303 Estimating the Risk Premium 340 Data Case 308 ■ COMMON N| STAKE Beta∨ ersus Volatility 340 The Capital Asset Pricing Model 342 PART 4 RISK AND RETURN Finance Lab 342 Key Terms 344 Further Reading344■ Problems344■ Data case 349 Chapter 10 Capital Markets and the Pricing of risk 312 Chapter 11 Optimal Portfolio choice 10.1 Risk and Return: Insights from 86 and the Capital Asset Pricing Years of Investor History 313 Model 351 10.2 Common measures of risk and Return 316 11.1 The Expected Return of a Probability Distributions 316 Portfolio 352 Expected Return 316 11.2 The volatility of a Two-Stock Variance and standard deviation 317 Portfolio 353 10.3 Historical returns of stocks and Combining Risks 353 Bonds 319 Determining Covariance and Computing Historical Returns 31 Correlation 354 Average Annual Returns 321 COMMON MISTAKE Computing Variance, Covariance, and Correlation in The variance and volatility of returns 323 Excel 356 Estimation Error: Using Past Returns to Predict the Future 324 Computing a Portfolio's variance and Volatility 357 Arithmetic Average Returns Versus Compound Annual returns 326 11.3 The volatility of a Large Portfolio 359 10. 4 The historical trade-Off Between Risk and return 326 Large Portfolio Variance 359 Diversification with an equally weighted The Returns of Large Portfolios 327 Portfolio 360 The returns of individual stocks 328 INTERVIEW with John powers 362 10.5 Common Versus Independent Diversification with genera Risk 329 Portfolios 363 Theft Versus Earthquake Insurance 11.4 Risk Versus Return: Choosing an An Example 329 Efficient portfolio 363 The role of diversification 330 Efficient Portfolios with Two stocks 364 10.6 Diversification in Stock The Effect of correlation 366 Portfolios 331 Short sales 367 Firm-Specific Versus Systematic Efficient Portfolios with Many Risk 332 Stocks 368 【实例截图】
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