1

Finance 3313-006: Business Finance

Spring 2011

Monday and Wednesday, 5:30-6:50pm, COBA 241

Instructor Dr. Jian Shi

Office 620 Business Building

Email jianshi@uta.edu

Phone (817)272-0208

Website http://www.uta.edu/blackboard

Office Hours Wednesday 2:00-4:00pm or by appointment

________________________________________________________________________

Teaching Assistant

The Teaching Assistant for this course is Mohammad Riaz Uddin. His office hours are

Tuesday 3:30-5:30pm or by appointment. His is located at 404 Business Building. He can

be contacted via email: muddin@mavs.uta.edu, or by phone: (817) 272-3835.

Course Materials

Required Text: Fundamentals of Corporate Finance, sixth edition, by Brealy, Myers

and Marcus, 2009

Required Finance Tutorial: Time Value of Money Finance Tutorial Current Version

(Important! carefully read the paragraphs on page 3 regarding this Finance Tutorial)

Required Calculator: A financial calculator is a necessity in this course. Texas

Instruments (TI) BA II Plus model is strongly recommended. I will talk about how to use

this calculator only. For any other financial calculators, students are responsible for

reading the instructions and learning how to master the calculators by themselves.

Students should bring the calculator to each and every of the classes and exams. Note

that a non financial calculator cannot replace the financial calculator required.

Required SCAN-TRON forms 882: At least thirty (30) SCAN-TRON forms 882 (green

color, available in UTA bookstore) must be supplied by the students. We’ll constantly

use these forms for quizzes, homework and exams.

Course Description and Objectives

This course is the introductory course and the foundation for most of other finance

courses. The student will learn the basic valuation concepts, and use financial tools,

concepts and analysis for making sound financial decisions in a corporate context. The

following topics will be covered in this course.

Business organizations, firms’ goals and behaviors

Financial markets and institutions

Value and valuation

Risk and return

2

Capital structure

Capital budgeting

Course Prerequisites ACCT 2302, ECON 2306 or 2301, MATH 1316 or 1426 and 60 hours required

Course Website

All course related materials will be posted on the course website which is under

Blackboard. The URL is http://www.uta.edu/blackboard. Please follow the instructions

on the page to log in and contact 817-272-2208 or helpdesk@uta.edu for any technical

support. Note that only registered students can log in.

Class Attendance

Students are required to attend each class and exam and are expected to come to each

class with their assignments completed. Attendance is checked through in-class quiz.

Anything discussed in class is testable. Any student who must miss a class is responsible

for securing any and all assignments for coursework missed.

Classroom Etiquette

Please respect your fellow students and the instructor by doing only class-related

activities inside the classroom. This may include, but is not limited to, silencing your cell

phones and refraining from non class-related talking during class time. In addition, no

laptop using is allowed during the class time unless it is otherwise instructed. Late

arrivals or leaving the classroom early will also negatively impact your final grade (also

refer to grading policies below).

Make-up Exams No make-up exams will be given under any circumstances. If you have to miss an exam due

to a university defined and approved excuse, you must submit such as a documented excuse

in writing to the instructor before (not after) the exam, except for extreme emergencies

(supporting documents must be provided thereafter in such cases). Otherwise, zero point will

be given to the exam. The score for the permissible missing exam meeting the above

standards will be assigned the same as your final exam score. For all other scenarios of

missing exams, zero point will be given to the corresponding exam.

Grading Policies

Grade Components: The final numerical grade will be determined by the following

parts:

Exam 1 20%

Exam 2 20%

Final Exam 25%

Homework 15%

Quizzes 15%

Finance Tutorial 5%

Total 100%

3

The instructor, at his discretion, reserves the right to negatively adjust up to 5 course

points (5% of total score) depending on your class performance including, but not limited

to, attendance, degree of class participation and class etiquette (see above for details).

The Three Exams: All the exams are in-class. No textbooks or class notes are allowed.

However, students can bring in a 3x5 cheat sheet on which anything can be written.

Double side writing is permitted. All the exams will consist of only multiple-choice

questions. SCAN-TRON form 882 (available from UTA bookstore) must be supplied by

the students, along with #2 pencils and erasers. A financial calculator is required for all

the exams. None of the exams is intended to be comprehensive. However, understanding

of the basic concepts of the previous exam(s) is presumed. All the exam books are the

properties of the instructor and will be taken back immediately after each exam. Students

may retain the SCAN-TRON forms after they are graded.

I reward those who make progress in this course. If your final exam score turns out

to be higher than either of the first two exam scores, your lowest score among the

three will be replaced with the final exam score, i.e., your final exam weight will

become 45% (20%+25%). Otherwise, the weights of the exams will be the same as

stated in “Grade Components” (20%, 20% and 25% respectively).

Graded Homework: Three (3) homework sets will be assigned during the semester.

Each homework set is worth 5% of your total score. It is important to do all the

homework sets not only because they count towards your final grade, but also because

they are good warm-ups for the exams.

Non-graded Homework: Exercise problems in the textbook chapters will also be

assigned (usually on the very last slide of each chapter). However, these will not be

collected and therefore will not count towards your final grade. Solutions to these

problems will be posted on the WebCT.

Quizzes: Quizzes will be given randomly during the semester. They may be given in the

very beginning of the class, during the class, or towards the end of the class. It is also

possible that multiple quizzes will be given in one class. So for any reasons, if you arrive

late or leave early, you may miss the quizzes. For missed quizzes, there is absolutely no

make-up given. If you have a written university defined excuse, the missed quiz score

will be assigned as the average score of all other quizzes you take during the semester.

Otherwise, missed quiz score will be zero. Your quiz score is 50% effort and 50% merit

based. That is if you turn in the quiz with all questions answered, you score will be

(0.5*100%+0.5*percentage of correct answers).

The Finance Tutorial: Completion of a spreadsheet-based Finance Tutorial is required

of all students enrolled in FINA 3313. You must complete the tutorial to pass this course.

This is a departmental policy. It must be purchased at the UTA Bookstore. The tutorial

consists of thirteen spreadsheets, each designed to solve a particular finance problem and

to teach a spreadsheet skill. At the end of each spreadsheet lesson, you are instructed to

print the spreadsheet. A proof of purchase (blue sheet of paper) must be attached to the

first spreadsheet. Staple each spreadsheet in the upper left corner. For students who have

completed the tutorial in another class, “Prior Completion Forms” may be submitted

4

instead. These forms are available at the Department of Finance and Real Estate Office

(434 Business Building).

Be sure to turn in the Finance Tutorial Spreadsheets or Prior Completion Forms by the

deadlines. The penalties for missing the deadlines are severe. Please see the following

schedule:

Completed and Handed in Penalty

Before or on May 4 Class None

After May 4 Class F for the course

Failure to Submit or Complete F for the course

A free tutor will be available to assist you with the Finance Tutorial. His/her lab hours

will be posted on the course website.

Course Grade: Your letter grade is assigned based on the calculation of your final grade.

Grade rounding only happens when your total score is within 0.50 course point

(inclusive) of the next grade level (e.g, 89.50 is an A, but 89.49 is a B). No exceptions!

The scale is

100-90 A

89-80 B

79-70 C

69-60 D

Below 60 F

Extra Credit Works: There will be no extra credit works to give under any

circumstances. Your final grade, once assigned, will not be changed except in an event of

grading/recording error.

5

Tentative Course Schedule

Depending on the overall course progress and due to the possibilities of unforeseeable

events, this course schedule (including both dates and topics) is tentative and subject to

change with verbal and/or written notice before/during assigned class time.

Dates Topics Readings

Wednesday, January 19 Syllabus and Corporate Goals CH 1

Monday, January 23 Financial Markets and Institutions CH 2

Wednesday, January 26 Finance & Accounting CH 3

Monday, January 31 The Time Value of Money CH 5

Wednesday, February 2 Class canceled due to weather

Monday, February 7 The Time Value of Money CH 5

Wednesday, February 9 Class canceled due to weather

Monday, February 14 The Time Value of Money CH 5

Wednesday, February 16 The Time Value of Money CH 5

Monday, February 21 The Time Value of Money CH 5

Wednesday, February 23 Exam 1 Review/HW1 Due

Monday, February 28 Exam 1

Wednesday, March 2 Review of Exam 1 Results/Valuing

Bonds

Monday, March 7 Valuing Bonds CH 6

Wednesday, March 9 Valuing Stocks CH 7

Monday, March 14 Spring Vacation/No Class

Wednesday, March 16 Spring Vacation/No Class

Monday, March 21 Valuing Stocks CH 7

Wednesday, March 23 NPV & Other Investment Criteria CH 8

Monday, March 28 NPV & Other Investment Criteria CH 8

Wednesday, March 30 NPV/ Exam 2 Review/HW2 Due CH 8

Monday, April4 Exam 2

Wednesday, April 6 Review of Exam 2 Results/ Risk &

Return: Introduction CH 11

Monday, April 11 Risk & Return: Introduction CH 11

Wednesday, April 13 Risk & Return: Portfolio Theory CH 11

Monday, April 18 Risk, Return & CAPM CH 12

Wednesday, April 20 Risk, Return & CAPM CH 12

Monday, April 25 WACC & Company Valuation CH 13

Wednesday, April 27 WACC & Company Valuation CH 13

Monday, May 2 Debt Policy CH 16

Wednesday, May 4 Payout Policy/ Final Exam Review/

Finance Tutorial Due/HW3 Due CH 17

Monday, May 9 Final Exam (5:30-8:00pm)

6

Syllabus Addendum

Academic Dishonesty:

All students are expected to pursue their scholastic careers with honesty and

integrity. It is the philosophy of this Department, this instructor, and the

University of Texas at Arlington that academic dishonesty is a completely

unacceptable mode of conduct and will not be tolerated in any form. All persons

involved in academic dishonesty will be disciplined in accordance with

University regulations and procedures. Discipline may include suspension or

expulsion from the University.

“Academic dishonesty includes, but is not limited to, cheating, plagiarism,

collusion, the submission for credit of any work or materials that are attributable

in whole or in part to another person, taking an examination for another person,

or any act designed to give unfair advantage to a student or the attempt to

commit such acts.” (Regents Rules and Regulations, Part One, Chapter VI,

Section 3.2, Subsection 3.2, Subdivision 3.22).

Institutional procedures regarding charges of academic dishonesty are outlined

in Part II, Chapter 2, of the Handbook of Operating Procedures of The

University of Texas at Arlington. Copies of the Handbook are available at

more than 75 locations on campus, including the Student Congress office, the

Library, and the Finance/Real Estate Department office (room 434 in COBA).

Americans with Disabilities Act (ADA):

The University of Texas at Arlington is on record as being committed to both the

spirit and the letter of the ADA to make reasonable adjustments in the classroom

necessary to eliminate discrimination on the basis of disability. Students

requesting an accommodation based on disability should meet privately with the

instructor during the first week of class to discuss their special needs, and advise

the instructor of any special needs, abilities or limitations and to discuss the

instructor’s expectations in class participation, performance and work standards.

Any disclosure by the students of their need for accommodations is recognized

to be extremely sensitive and all conversations and other communications will

be protected and confidential and disclosed on a need-to-know basis only.

Students are responsible for contacting and consulting with the University’s

Office for Students with Disabilities prior to contacting the instructor about

any disabilities. The student should provide the instructor with some form of

written documentation of the disability from an acceptable, external source (such

as a doctor, psychiatrist etc.) and from the Office for Students with Disabilities.

Attendance Policy:

Students are expected to attend each class and to do so with their assignments

completed. Any student who must miss a class is responsible for securing any

and all assignments for coursework missed.

7

Drop Policy:

These policies include by reference all provisions for grade adjustment or drop

policies included in the applicable Graduate or Undergraduate Catalog in effect

at the start of the semester. It is the student’s responsibility to complete the

course or withdraw from the course in accordance with University regulations.

No student will be dropped from the class rolls for absences. Students are

strongly encouraged to verify their grade status before dropping a course after

the first withdrawal date. A student who drops a course after the first withdrawal

date may receive an “F” in the course if the student is failing at the time the

course is dropped.

Drop for Non-Payment:

It is the policy of the University of Texas at Arlington that students who have not

paid by the census date and are dropped for non-payment cannot, under any

circumstances, receive a grade for the course. Therefore, a student dropped for

non-payment who continues to attend the course will not receive a grade for

that course. Emergency loans are available to help students pay tuition and fees.

Students can apply for emergency loans by going to the Emergency Tuition

Loan Distribution Center at E.H. Hereford University Center (near the southwest

entrance).

Distribution of Grades:

The distribution of grades for the semester will normally adhere to the guidelines

of the Department of Finance and Real Estate. These guidelines are generally

based on College of Business Administration averages for similar courses.

Student Evaluation of Teaching:

The following appears in Administrative Memorandum No. 98-5, dated August

21, 1997, from the President to academic and administrative offices: “Beginning

in Fall 1997, teaching evaluations will be conducted in every class every

semester for every instructor on record.”

College of Business Bomb Threat Policy:

Effective April 8, 1996, the College of Business Administration adopted a policy

to deal with the classroom disruption caused by bomb threats in the building.

Section 22.07 of the Texas Criminal Law states that a Class A misdemeanor is

punishable by (1) a fine not to exceed $4,000, (2) a jail sentence of not more

than one year, or (3) both such a fine and confinement. If anyone is tempted to

call in a bomb threat, be aware that UTA has the technology to trace such phone

calls.

Every effort will be made to avoid cancellation of presentations/tests caused by

bomb threats to the Business Building. Unannounced alternate sites will be

available for these classes. If a student who has a class with a scheduled test or

presentation arrives and the building has been closed due to a bomb threat, the

student should immediately check for the alternate class site notice which will be

posted on/near the main doors on the south side for the Business Building. If the

8

bomb threat is received while class is in session, your instructor will ask you to

leave the building and reconvene at another location.

Students who provide information leading to the successful prosecution of

anyone making a bomb threat will receive one semester’s free parking in the

Maverick Garage across the Business Building. UTA’s Crimestoppers will

provide a reward to anyone providing information leading to an arrest. To make

an anonymous report, call 817/272-3381.

Food/Drink in Classrooms:

College policy prohibits food and/or drinks in classrooms and labs. Anyone

bringing food and/or drinks into a classroom will be required to remove such

items, as directed by the class instructor or lab instructor.

UTA Student Success Programs:

The University of Texas at Arlington supports a variety of student success

programs to help you connect with the University and achieve academic success.

They include learning assistance, developmental education, advising and

mentoring, admission and transition, and federally funded programs. Students

requiring assistance academically, personally, or socially should contact the

Office of Student Success Programs at 817/272-6107 for more information and

appropriate referrals.

Business Career Services: (College of Business Administration, Room 106, 817-

272- 5201; Hours, Monday-Friday 8:00 a.m. to 5:00 p.m.)

The following services are designed to assist students as they navigate through

their college career. It is recommended that you visit the Business Career

Services office early in your college career to take full advantage of all available

services.

Career Counseling/Job Search Skills: Individualized guidance on

employment choices and techniques for gaining employment.

Career Days: Events designed to allow students to meet company

representatives to explore employment opportunities.

Career Development Workshops: Group sessions where job search skills

such as resume writing, employer research, dining etiquette, dressing for

success, salary negotiations, and interview skills are taught. Specialized

sessions on topics such as internships, diversity in the workplace, making

wise job choices, first year job success tips, and interview skills for

international students are also offered.

Mentor Program: The opportunity for students to be paired with

professionals in corporate settings to explore and/or solidify their

major/job interests. This is done through informational interviews and/or

9

job shadowing. Freshman and sophomore students are targeted for these

opportunities.

Resume Critiquing: The opportunity for students to have their resume

professionally critiqued by staff members who can make suggestions for

improving and/or changing it to suit employers’ specifications.

Internship Program: The opportunity for students to gain real-world

work experience in their degree field prior to graduation. Some

internships can be completed for academic credit. Junior, senior, and

graduate students are targeted for these opportunities.

Mock Interviews: An individual session where students can practice

various types of interview questions that may be asked during an actual

interview. A critique of students’ interview skills will be given, as well

as tips for improvement.

Career Classifieds: On-line job postings that students who are registered

with Career Services are encouraged to review and respond to when

seeking full-time, degree-related employment.

Web Resume Book: Students who are registered with Career Services

also have the option of having employers view their resume via the on-

line system when they are seeking qualified candidates to fill available

employment opportunities.

Resource Library: Career, company and job search resources are

available for students to use during regular office hours. Computers are

available to assist in conducting job searches.

Career Development Handouts: Materials covering various job search

skills are available for students to take home and utilize as they are

preparing for all facets of their job search.

On-Campus Interviews: The opportunity for students who are registered

with Career Services to interview with companies during the fall and

spring semesters when corporate recruiters visit the campus.