Finance for Non-Finance Professionals
This short course surveys all the major topics covered in a full semester MBA level finance course, but with a more intuitive approach on a very high conceptual level. The goal here is give you a roadmap and framework for how financial professional make decisions. We will cover the basics of financial valuation, the time value of money, compounding returns, and discounting the future. You will understand discounted cash flow (DCF) valuation and how it compares to other methods.
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- Level Foundation
- Duration 14 hours
- Course by Rice University
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Offered by
About
This short course surveys all the major topics covered in a full semester MBA level finance course, but with a more intuitive approach on a very high conceptual level. The goal here is give you a roadmap and framework for how financial professional make decisions. We will cover the basics of financial valuation, the time value of money, compounding returns, and discounting the future. You will understand discounted cash flow (DCF) valuation and how it compares to other methods. We also step inside the mind of a corporate financial manager and develop the basic tools of capital budgeting. We will survey the how, when, and where to spend money, make tradeoffs about investment, growth, dividends, and how to ensure sound fiscal discipline. Our journey then turns to a Wall Street or capital markets perspective of investments as we discuss the fundamental tradeoff between risk and return. We then synthesize our discussion of risk with our valuation framework and incorporate it into series of direct applications to practice. This course requires no prior familiarity with finance. Rather, it is intended to be a first step for anyone who is curious about understanding stock markets, valuation, or corporate finance. We will walk through all of the tools and quantitative analysis together and develop a guide for understanding the seemingly complex decisions that finance professionals make. By the end of the course, you will develop an understanding of the major conceptual levers that push and pull on financial decision making and how they relate to other areas of business. The course should also serve as a roadmap for where to further your finance education and it would be an excellent introduction of any students contemplating an MBA or Finance concentration, but who has little background in the area.Modules
Course Overview
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2
Videos
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3
Readings
2
Videos
- Course Trailer
- Course Overview & Demonstration
3
Readings
- General Course Information
- Discussion Forum Guidelines
- Pre-Course Survey
Week 1: Basic Principles of Financial Valuation Discounting
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12
Videos
12
Videos
- Week 1 Overview
- Human Nature and the Time Value of Money
- Compounding and Earning Returns Over Time
- Basic Principals of Valuation and Discounting
- Discounting Future Cash Back to the Present
- Discounted Cash Flow (DCF) as the Basis for All Valuation
- DCF Practical Example
- Valuation by Comparables
- Examples and Applications: Bonds
- Examples and Applications: Mortgages
- Examples and Applications: Annuities
- Examples and Applications: Capstone Example
Finance in the Field
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1
Videos
-
1
Discussion
1
Discussions
- Real World Application: Introduce Yourself!
1
Videos
- Conversations with a Practitioner
Assignments
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2
Assignment
2
Assignment
- Homework Assignment
- Week 1 Quiz
Week 2: How to Spend Money (Capital Budgeting Tools)
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10
Videos
10
Videos
- Week 2 Overview
- Overview of the Capital Budgeting Process
- Net Present Value (NPV)
- Payback Period
- Accounting Ratios
- Internal Rate of Return (IRR)
- Wrinkles with IRR
- Using All the Metrics Together
- Sensitivity Analysis
- Spreadsheet Modeling
Finance in the Field
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1
Videos
-
1
Readings
1
Videos
- Conversations with a Practitioner
1
Readings
- Real World Application: A Refresher on Net Present Value
Assignments
-
2
Assignment
2
Assignment
- Homework Assignment
- Week 2 Quiz
Week 3: Measuring Cash Creation and Flow
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9
Videos
9
Videos
- Week 3 Overview
- Brief Overview of the Financial Statements
- Hunting for Cash Creation
- Working Capital Adjustments
- Depreciation and Capital Expenditures
- Salvage and Terminal Values
- Taxes
- Calculating Free Cash Flow
- Using Capital Budgeting Tools
Finance in the Field
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1
Videos
-
1
Readings
1
Videos
- Conversations with a Practitioner
1
Readings
- Real World Application: Obama Administration Releases Report Outlining Benefits of Expensing Proposal in Encouraging Business Expansion, Hiring Now
Assignments
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2
Assignment
2
Assignment
- Homework Assignment
- Week 3 Quiz
How Much Does Money Cost? Evaluating the Cost of Capital
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9
Videos
9
Videos
- Week 4 Overview
- Debt vs. Equity Financing
- Risk Free Rate
- Historical Risk and Return
- The Equity Risk Premium
- Beta and the Cost of Equity
- Credit Ratings and Quality Spreads
- Estimating the Cost of Debt
- Putting it All Together as the WACC (Weighted Average Cost of Capital)
Finance in the Field
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1
Videos
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2
Readings
1
Videos
- Conversations with a Practitioner
2
Readings
- Real World Application: U.S. oil companies closer to balancing capital investment with operating cash flow
- Real World Application: Why aren't companies spending?
Assignments
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2
Assignment
2
Assignment
- Homework Assignment (Optional)
- Week 4 Quiz
Capstone Case: Sunrise Bakery Expansion
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1
Videos
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2
Readings
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1
Assignment
1
Assignment
- Capstone Case Questions
1
Videos
- Overview of Capstone Case
2
Readings
- Background: Sunrise Bakery Expansion
- Instructions: Sunrise Bakery Expansion
Final Exam
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1
Readings
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1
Assignment
1
Assignment
- Final Exam
1
Readings
- End-of-Course Survey
Auto Summary
"Finance for Non-Finance Professionals" is an accessible and comprehensive course designed to demystify financial concepts for those without a finance background. Offered within the Business & Management domain, this course is perfect for anyone curious about the financial decision-making processes in corporate environments or those considering an MBA or Finance concentration. Guided by an expert instructor, the course covers essential topics such as financial valuation, the time value of money, and capital budgeting. You'll explore the fundamentals of discounted cash flow (DCF) valuation, understand investment tradeoffs, and learn about risk and return in the context of capital markets. This foundational course spans approximately 840 minutes and is available through Coursera under a Starter subscription. It requires no prior knowledge of finance, making it an ideal first step for aspiring finance professionals or anyone interested in gaining a deeper understanding of financial decision-making. By the end of the course, participants will have a solid grasp of key financial concepts and a clear framework for further finance education, empowering them to navigate and succeed in the world of finance with confidence.
James Weston