## Corp Finance 12 Capital Budgeting Investment Risk Tools

### What you’ll learn

List and define risk management tools that relate to capital budgeting and investment decisions

Explain the concept of population mean and expected value

Discuss the term population variance and how it can apply to capital budgeting decisions

Describe standard deviation and how it can apply to capital budgeting decisions

Explain the concept of coefficient of variation and how it can be used to measure risk in the capital budgeting decision making process

Define simulation models and how they can be useful in capital budgeting decisions

Discuss how capital budgeting decisions should take into consideration the overall investment portfolio

### Requirements

Basic understanding of corporate finance concepts

### Description

This course will cover the use of risk assessment tools as they relate to capital budgeting and investment decisions and how to use them.We will include many example problems, both in the format of presentations and Excel worksheet problems. The Excel worksheet presentations will include a downloadable Excel workbook with at least two tabs, one with the answer, the second with a preformatted worksheet that can be completed in a step-by-step process along with the instructional videos.When making long term investment and capital budgeting decisions we need to consider the time value of money. The decision-making process will estimate future cash flows and then apply our time value of money concepts to those future cash flows.This course will take a step back in the process, providing tools to best estimate the future cash flows. To make the best decision we will need to estimate what the future cash flows will be and the likelihood of those cash flows, giving us numbers we can apply present value concepts to while also taking into consideration risk.To help measure risk, the course will use statistical tools including the population mean, population variance, standard deviation, and coefficient of variation.We will provide a quick overview of these statistical concepts in general and then consider how we can apply them to measuring risk for investment and capital budgeting decisions.

### Overview

Section 1: Introduction

Lecture 1 1310 Capital Budget Risk Overview

Lecture 2 1315 Measure of Risk

Lecture 3 1320 Risk & Discount Rates

Lecture 4 1325 Simulation Models

Lecture 5 1330 Investment Impact on Portfolio

Section 2: Practice Probs. – Capital Budgeting Risk Assessment

Lecture 6 OneNote Resource

Lecture 7 1300 Standard Deviation, Variance, & Coefficient of Variation

Lecture 8 1312 Standard Deviation, Variance, & Coefficient of Variation

Lecture 9 1313 Expected Value, Standard Deviation, & Coefficient of Variation Prob. 2

Lecture 10 1314 Expected Value, Standard Deviation, & Coefficient of Variation Prob. 3

Lecture 11 1316 Coefficient of Variation Three Investment Alternatives

Lecture 12 1318 Coefficient of Variation & Investment Risk

Lecture 13 1322 Coefficient of variation Two Project Alternatives

Lecture 14 1326 Expected Value & Net Present Value Even Yearly Cash Flows

Lecture 15 1328 Expected Value & Coefficient of Variation Investment Options

Lecture 16 1329 Expected Value in Capital Budgeting Decision Uneven Payments

Lecture 17 1331 Expected Value for Multiple Years & NPV

Section 3: Excel Probs. – Capital Budgeting Risk Assessment

Lecture 18 1300 Standard Deviation, Variance, & Coefficient of Variation

Lecture 19 1312 Expected Value, Standard Deviation, & Coefficient of Variation Prob. 1

Lecture 20 1313 Expected Value, Standard Deviation, & Coefficient of Variation Prob. 2

Lecture 21 1314 Expected Value, Standard Deviation, & Coefficient of Variation Prob. 3

Lecture 22 1316 Coefficient of Variation Three Investment Alternatives

Lecture 23 1318 Coefficient of Variation & Investment Risk

Lecture 24 1322 Expected Value & Net Present Value Even Yearly cash Flows

Lecture 25 1328 Expected Value & Coefficient of Variation Investment Options

Lecture 26 1329 Expected Value in Capital Budgeting Decision Uneven Payments

Lecture 27 1331 Expected Value for Multiple Years & NPV

Business students,Business professionals

#### Course Information:

Udemy | English | 5h 21m | 2.86 GB

Created by: Robert (Bob) Steele

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