the capital asset pricing model and the relationship between equity and asset betas. e)Assess an organisation's debt exposure to interest rate changes using the simple Macaulay duration and modified duration methods. f)Discuss the benefits and limitations of duration including the impact of convexity. g)Assess the organisation's exposure to credit risk,including: i)Explain the role of,and the risk assessment models used by the principal rating agencies ii)Estimate the likely credit spread over risk free iii)Estimate the organisation's current cost of debt capital using the appropriate term structure of interest rates and the credit spread. h)Assess the impact of financing and capital structure upon the organisation with respect to: i)Modigliani and Miller propositions,before and after tax ii)Static trade-off theory iii)Pecking order propositions iv)Agency effects. i)Apply the adjusted present value technique to the appraisal of investment decisions that entail significant alterations in the financial structure of the organisation,including their fiscal and transactions cost implications. j)Assess the impact of a significant capital investment project upon the reported financial position and performance of the organisation taking into account alternative financing strategies. 3.问题和应用 a)What does capital cost include? b)What is trade-off theory? 第四节 1.主要内容 Valuation and the use of free cash flows 2.基本概念和知识点 a)Apply asset based,income based and cash flow based models to value equity.Apply appropriate models,including term structure of interest rates, the yield curve and credit spreads,to value corporate debt.11 the capital asset pricing model and the relationship between equity and asset betas. e) Assess an organisation’s debt exposure to interest rate changes using the simple Macaulay duration and modified duration methods. f) Discuss the benefits and limitations of duration including the impact of convexity. g) Assess the organisation’s exposure to credit risk, including: i) Explain the role of, and the risk assessment models used by the principal rating agencies ii) Estimate the likely credit spread over risk free iii) Estimate the organisation’s current cost of debt capital using the appropriate term structure of interest rates and the credit spread. h) Assess the impact of financing and capital structure upon the organisation with respect to: i) Modigliani and Miller propositions, before and after tax ii) Static trade-off theory iii) Pecking order propositions iv) Agency effects. i) Apply the adjusted present value technique to the appraisal of investment decisions that entail significant alterations in the financial structure of the organisation, including their fiscal and transactions cost implications. j) Assess the impact of a significant capital investment project upon the reported financial position and performance of the organisation taking into account alternative financing strategies. 3. 问题和应用 a)What does capital cost include? b)What is trade-off theory? 第四节 1.主要内容 Valuation and the use of free cash flows 2.基本概念和知识点 a) Apply asset based, income based and cash flow based models to value equity. Apply appropriate models, including term structure of interest rates, the yield curve and credit spreads, to value corporate debt