IEORE4003 Corporate Finance for Engineers
3 pts. Lect: 3. Probability and Statistics at the level of SIEO W3600 or SIEO W4150, and Deterministic Models at the level of IEOR E3608 or IEOR E4004, or instructor permission. This course is required for all undergraduate students majoring in IE, OR:EMS, OR:FE and OR. This course discusses how to allocate capital to projects within a firm in order to maximize the value of the firm to its shareholders. We describe how an investment project can be characterized by its cash flow profile, i.e., the amount and timing of costs and benefits of this project in the planning horizon. We show how firms should take into account the cost of capital, budgets, taxes, depreciation, inflation, and uncertainty, in order to decide which projects to undertake, reject, or postpone. This course is a good preparation for positions in investment banking, consulting, private equity, venture capital, corporate finance, and construction management, and for entrepreneurs. Students can take only one of IEOR E4003 and IEOR E4403, but not both.