1 UNIVERSITY COLLEGE DUBLIN Bachelor of Business Studies (Singapore) BBS35 FT Singapore FIN2002S Principles of Finance STUDY GUIDE Remote Delivery using Brightspace Collaborate Copyright September 2021 2 Author: Dr. June Neo (September 2021) This manual was prepared for University College Dublin as a comprehensive support for students completing the above-mentioned Degree programme. © This publication may not be reproduced, in whole or in part without permission in from University College Dublin. Module Coordinator: Dr. June Neo (local lecturer) Email:
[email protected] Email subject: Please state: BBS35 PoF – Topic of enquiry – Student’s Name / Number Note: There will be no response if the students failed to state the email subject as indicated above. 3 TABLE OF CONTENTS PAGE WELCOME MESSAGE 1. INTRODUCTION 5 Accessing Brightspace Collaborate a. Background details b. Module aims c. Programme goals 2. MODULE OUTLINE 9 a. Module learning outcomes b. Themes and topics c. Learning materials 3. MODULE DELIVERY SCHEDULE 12 a. Session arrangements b. Student engagement c. Office hours arrangements 4. ASSESSMENT DETAILS 22 a. Continuous assignments b. Module assessment components i. Assignment (Individual) ii. Assignment (Group) iii. Examination 5. GRADING 28 a. University grading policy b. Grade descriptors for assessment components 6. CONCLUDING COMMENTS 30 APPENDICES 31 4 WELCOME MESSAGE As module coordinator of the Principles of Finance module, I welcome you to the module. The finance sector is a major driving force of a country’s economy. It encompasses the creating and maintaining of wealth, and overall managing of money that is crucial to the success of every business. Very broad areas, finance professionals can be found in every industry helping businesses as well as individuals. The subject of Principles of Finance provides a mixture of both theory and practise. It aims to provide the students with an introduction to the role of Finance, financial markets, financial institutions as well as analysis of financial securities, thus providing a solid foundation for further study or employment in the financial services industry. To successfully complete this module, it is strongly recommended that a consistent routine of studies is maintained, and several learning activities such as course assignments are to be completed at the stated submission date(s). The graduates will have a wealth of career choices within and beyond the finance sector. You will be equipped for success in fields such as credit, corporate finance, financial planning and services, investment and wealth management. This study guide outlines the discussion areas for each session. It is essential for these to be read prior to the sessions to have a better understanding in the subject topics. Should you require clarification on any matter pertaining to the module, please do not hesitate to contact me. I am looking forward to meeting you soon. Dr. June Neo Module Lecturer 5 PART 1: INTRODUCTION This Study Guide is designed to provide you with details of the module FIN2002S – Principles of Finance, the learning outcomes, delivery and assessment arrangements. The Study Guide consists of 6 parts. Part 1 gives background details to the subject area are provided and the broad aims of the module are set out. Part 2 consists of the module outline. In this part the (a) module learning outcomes, (b) the themes and topics to be explored are explained along with the (c) learning supports to be used. Part 3 gives details of the module delivery arrangements. It sets out the session arrangements and the expectations in relation to your prior preparation and student engagement. Part 4 provides details of the assessment techniques used in this module explaining the assessment components, their rationale. Part 5 explains the UCD grading policy and grade descriptors drawing on the university document are given for each assessment component (i) Assignment and (ii) Examination. Part 6 presents the concluding comments. Accessing Zoom via Brightspace Collaborate This module will be wholly delivered via UCD’s Collaborate platform. This is accessible via brightspace.ucd.ie The students are informed to access the class by logging into Brightspace, then click on “My Class” -> “Zoom” Topic: FT BBS35 FIN2002S POF 6 Background Details a. Background to the Topic This course provides an introduction to the principles of banking and finance. It module covers the fundamental basics of finance. The module will address issues such as why corporate finance is important and will introduce the theoretical underpinnings of financial concepts. A comprehensive range of issues including the role of corporate governance and agency theory in finance, how the stock and bond markets function, pricing stocks and bonds, and capital budgeting techniques will be introduced. The topics covered in this module will allow students to learn about the concepts and theories in finance that would help investors and business decision-makers in making investment and financing investments as well as knowing how risk can be managed. The knowledge obtained from this course would be very valuable for one’s to embark on a professional or business career in either the Financial Markets or the different Financial Institutions. b. Module Aims The aims of this module are to - enable students to understand the importance of corporate finance and the theoretical underpinnings of financial concepts. - enable students to understand the valuation of stocks and bonds. - enable students to understand the role of corporate governance and agency theory in finance. - allow students to apply capital budgeting techniques in the project evaluation process Module philosophy The module draws on student prior learning and work experience and combines insights from strategy, international trade and investment theory, human resource management and other areas. 7 The assessment tasks for this module have been designed with this in mind as detailed later in the study guide. Programme Goals Programme Goals Specify the overall programme goal and insert a one-line description of each goal. Programme Learning Outcomes Specify the learning outcomes associated with each programme goal. On successful completion of the programme students should be able to: FIN2002S (Sg) Principles of FInance Module Components 1) Programme Goal 1: Informed Thinkers: Our graduates will be knowledgeable on management theory and will be able to apply this theory to business problems (Knowledge). Programme Learning Outcome 1a: Explain current theoretical underpinnings of business and the management of organisations. X (Exam question, Individual Assessment) Programme Learning Outcome 1b: Apply appropriate methods, tools and techniques for identifying, analysing and resolving business problems within functional and across functional business areas. X (Exam question, Individual Assessment, Group Assessment) 2) Programme Goal 2: Communication, Analytical and Critical Thinking Skills: Our graduates will have well developed skills of communication, analysis and critical Programme Learning Outcome 2a Prepare a short business presentation (written and/or oral) on a current business issue. Programme Learning Outcome 2b: X (Individual Assessment) 8 thinking (Skills and Competencies). Analyse specific business case studies or problems and formulate a report detailing the issues and recommended actions. Programme Learning Outcome 2c: Conduct secondary research on management-related issues and report on the findings and draw appropriate conclusions. 3) Programme Goal 3: Personal and Professional Development: Our graduates will demonstrate a commitment to personal and professional excellence and development (Skills, Competencies and Attitudes). Programme Learning Outcome 3a: Develop collaborative learning and team-work skills by engaging in module-related team activities. X (Group Assessment) Programme Learning Outcome 3b: Demonstrate capacity for problem solving collaboratively and individually. X (Individual Assessment, Group Assessment) 4) Programme Goal 4: Ethical Awareness: Our graduates will demonstrate an awareness of ethical issues in business and their impact on society (Attitudes). Programme Learning Outcome 4a: Demonstrate an awareness of ethical values and business issues concerning the advancement of the broader societal ‘good’. X (Individual Assessment) Programme Learning Outcome 4b: Illustrate an understanding of how business decisions might influence society and the wider community at large. X (Individual Assessment) 9 PART 2: MODULE OUTLINE Module Title: Principles of Finance Module Code: FIN2002S No. of ECTS: 10 Module Learning Outcomes On completing this module, students will be expected be able to: • Understand the importance and the role of Finance • Apply valuation methods to both stocks and bonds • Apply the techniques of capital budgeting and identify capital investment projects that maximize shareholder wealth • Understand the concepts of risk and return and the basic principles of portfolio theory. Module Text: Basic Finance: An Introduction to Financial Institutions, Investments, and Management (12th Edition) Cengage by Herbert B. Mayo ISBN: 9781337691017 Supplementary text 1: Principles of Finance (6th Edition), Cengage by Besley, S and Brigham, E. F. ISBN: 9781285429649 Supplementary text 2: Corporate Financial Management. (6th Edition). Pearson Education Limited by Arnold, G. and Lewis, D. ISBN: 9781292140445 10 Themes and Topics Part 1 Introduction to Finance: • The finance world • The objective of the firm. • Corporate governance and agency theory. Part 2: Valuation of Securities: • Time value of money • Present value and future value • Valuation of bonds. • Valuation of stocks Part 3: Capital Budgeting decision: • Net present value NPV), • Internal rate of return (IRR), and • payback period methods • Other project appraisal methods Part 4: Portfolio Theory: • Risk and Return. • Portfolio analysis: mean-variance portfolio theory. • Efficient portfolios • Capital Asset Pricing Model (CAPM) • Efficient Market Hypothesis 11 Learning Materials For this module, please read the assigned chapters in the prescribed text and attempt the learning activities in the hand-outs prior to attending the sessions. Other useful sources The following textbooks’ companion websites provide a self-quiz and study program that allows students to evaluate their performance through a practice test and recommendations: • https://media.pearsoncmg.com/intl/global/ema_ge_mishkin_econmbfm_11/index .html • http://wps.pearsoned.co.uk/ema_ge_mishkin_econmbfm_10/226/58088/148707 66.cw/index.html • http://wps.aw.com/bp_mishkin_econmbfm_10/215/55045/14091673.cw/index.ht ml Students completing this module are expected to participate in session discussions and learning activities and be familiar with recent developments in the business world. To facilitate this, the following source material is useful • The Economist • The Wall Street Journal • The Straits Times • The Financial Times • Business Week • Fortune 12 PART 3: MODULE DELIVERY SCHEDULE The module delivery relies on students’ ability to engage in prior preparation, to seek confirmation and clarification as appropriate and to be actively engaged during the sessions. Session Arrangements Each student is expected to attend and be prepared for all sessions. Table 1 below outlines the structure for the sessions. Please see below the schedule and details of our sessions Session Arrangements The module delivery relies on students’ ability to engage in prior preparation, to seek confirmation and clarification as appropriate and to be actively engaged during the sessions. Each student is expected to attend and be prepared for all sessions. An essential part of this preparation is to answer of the assigned problems before coming to class. This will foster discussion and will enhance the learning experience for the student. 13 Table 1 below outlines the structure for the sessions (26th April 2021 – 18th June 2021). Table 1: Module Delivery Schedule – themes, readings, cases Dr. June Neo Date / Time Theme /Topic title Text chapters articles/ Readings* Part 1: Introduction to Finance Session 1 Groups A to F: Please check your session dates Online session begins at: Groups A to F: Please check your session timings Please log in using your Zoom login link found at page 5 of this study guide at least 5 minutes in advance Introduction to Finance 1st half an hour: Module Introduction and The finance world (Topic 1) 2nd half an hour: Activity 3rd half an hour: The finance world cont’d Short break for 15 minutes Next 15 minutes: Activity Next half an hour: The objective of the firm Next half an hour: Activity Core text: Chapters 1 to 2 Supplementary text 1: Chapters 1 to 4 Supplementary text 2: Chapter 1 The activities will be selected questions at end of chapters Session 2 Groups A to F: Please check your session dates Online session begins at: Groups A to F: Please check your session timings Introduction to Finance: 1st half an hour: The objective of the firm 2nd half an hour: Activity 3rd half an hour: Corporate Governance Short break for 15 minutes Next 15 minutes: Activity Next half an hour: Agency theory Core text: Chapters 1 to 2 Supplementary text 1: Chapter 6 14 Please log in using your Zoom login link found at page 5 of this study guide at least 5 minutes in advance Next half an hour: Activity Supplementary text 2: Chapter 1 The activities will be selected questions at end of chapters Part 2: Valuation of Securities Session 3 Groups A to F: Please check your session dates Online session begins at: Groups A to F: Please check your session timings Please log in using your Zoom login link found at page 5 of this study guide at least 5 minutes in advance Valuation of Securities: 1st half an hour: Time value of money 2nd half an hour: Activity 3rd half an hour: Time value of money Short break for 15 minutes Next 15 minutes: Activity Next half an hour: Present value and futures value – Single cash flows Next half an hour: Activity Core text: Chapters 7, 10 to 14 Supplementary text 1: Chapters 9 to 10 The activities will be selected questions at end of chapters Session 4 Groups A to F: Please check your session dates Online session begins at: Groups A to F: Valuation of Securities: 1st half an hour: Present value and futures value – Multiple cash flows: Annuity 2nd half an hour: Activity 3rd half an hour: Present value and futures value – Multiple cash flows: Perpetuity Short break for 15 minutes Core text: Chapters 7, 10 to 14 Supplementary text 1: Chapters 9 to 10 15 Please check your session timings Please log in using your Zoom login link found at page 5 of this study guide at least 5 minutes in advance Next 15 minutes: Activity Next half an hour: Valuation of Bonds Next half an hour: Activity The activities will be selected questions at end of chapters Session 5 Groups A to F: Please check your session dates Online session begins at: Groups A to F: Please check your session timings Please log in using your Zoom login link found at page 5 of this study guide at least 5 minutes in advance Valuation of Securities: 1st half an hour: Valuation of Bonds – Cont’d 2nd half an hour: Activity 3rd half an hour: Valuation of Stocks Short break for 15 minutes Next 15 minutes: Activity Next half an hour: Valuation of Stocks – Cont’d Next half an hour: Activity Core text: Chapters 7, 10 to 14 Supplementary text 1: Chapters 9 to 10 The activities will be selected questions at end of chapters Part 3: Capital Budgeting decision Session 6 Groups A to F: Please check your session dates Online session begins at: Groups A to F: Capital Budgeting decision: 1st half an hour: Net Present value (NPV) Concept 2nd half an hour: Activity 3rd half an hour: NPV calculations Short break for 15 minutes Core text: Chapters 19, 21 to 22 Supplementary text 1: Chapters 12 to 13 16 Please check your session timings Please log in using your Zoom login link found at page 5 of this study guide at least 5 minutes in advance Next 15 minutes: Activity Next half an hour: issues with NPV Next half an hour: Activity Supplementary text 2: Chapter 2 The activities will be selected questions at end of chapters Session 7 Groups A to F: Please check your session dates Online session begins at: Groups A to F: Please check your session timings Please log in using your Zoom login link found at page 5 of this study guide at least 5 minutes in advance Capital Budgeting decision: 1st half an hour: Internal rate of return (IRR) Concept 2nd half an hour: Activity 3rd half an hour: IRR calculations Short break for 15 minutes Next 15 minutes: Activity Next half an hour: issues with IRR Next half an hour: Activity Core text: Chapters 19, 21 to 22 Supplementary text 1: Chapters 12 to 13 Supplementary text 2: Chapter 2 The activities will be selected questions at end of chapters Session 8 Groups A to F: Please check your session dates Online session begins at: Groups A to F: Capital Budgeting decision: 1st half an hour: Payback period Concept 2nd half an hour: Activity 3rd half an hour: Payback period calculations Short break for 15 minutes Next 15 minutes: Activity Core text: Chapters 19, 21 to 22 Supplementary text 2: Chapter 4 17 Please check your session timings Please log in using your Zoom login link found at page 5 of this study guide at least 5 minutes in advance Next half an hour: issues with Payback period Next half an hour: Activity The activities will be selected questions at end of chapters Session 9 Groups A to F: Please check your session dates Online session begins at: Groups A to F: Please check your session timings Please log in using your Zoom login link found at page 5 of this study guide at least 5 minutes in advance Capital Budgeting decision: 1st half an hour: Other project appraisal methods – Profitability Index 2nd half an hour: Activity 3rd half an hour: Profitability Index calculations Short break for 15 minutes Next 15 minutes: Activity Next half an hour: issues with Profitability Index Next half an hour: Activity Core text: Chapters 19, 21 to 22 Supplementary text 2: Chapter 4 The activities will be selected questions at end of chapters Part 4: Portfolio Theory Session 10 Groups A to F: Please check your session dates Online session begins at: Groups A to F: Portfolio Theory: 1st half an hour: Risk and return concept 2nd half an hour: Activity 3rd half an hour: Risk and return calculations Short break for 15 minutes Next 15 minutes: Activity Core text: Chapter 8 Supplementary text 1: Chapter 11 18 Please check your session timings Please log in using your Zoom login link found at page 5 of this study guide at least 5 minutes in advance Next half an hour: Portfolio analysis: mean- variance portfolio theory Next half an hour: Activity Supplementary text 2: Chapters 6 to 7 The activities will be selected questions at end of chapters Session 11 Groups A to F: Please check your session dates Online session begins at: Groups A to F: Please check your session timings Please log in using your Zoom login link found at page 5 of this study guide at least 5 minutes in advance Portfolio Theory: 1st half an hour: Portfolio analysis: mean- variance portfolio theory – cont’d 2nd half an hour: Activity 3rd half an hour: Efficient portfolios Short break for 15 minutes Next 15 minutes: Activity Next half an hour: Efficient portfolios – Cont’d Next half an hour: Activity Core text: Chapter 8 Supplementary text 1: Chapter 11 Supplementary text 2: Chapter 7 The activities will be selected questions at end of chapters Session 12 Groups A to F: Please check your session dates Online session begins at: Groups A to F: Portfolio Theory: 1st half an hour: Capital Asset Pricing Model (CAPM) 2nd half an hour: Activity 3rd half an hour: Issues with CAPM Short break for 15 minutes Next 15 minutes: Activity Core text: Chapter 8 Supplementary text 1: Chapter 11 19 Please check your session timings Please log in using your Zoom login link found at page 5 of this study guide at least 5 minutes in advance Next half an hour: Efficient Market Hypothesis Next half an hour: Activity Supplementary text 2: Chapter 8 The activities will be selected questions at end of chapters Session 13 Groups A to F: Please check your session dates Online session begins at: Groups A to F: Please check your session timings Please log in using your Zoom login link found at page 5 of this study guide at least 5 minutes in advance Revision Session 14 Groups A to F: Please check your session dates Online session begins at: Groups A to F: Please check your session timings Revision Module Review and Close out Session 20 Please log in using your Zoom login link found at page 5 of this study guide at least 5 minutes in advance * Some chapters in the text are assigned for more than one theme. Preparation Required in Advance of Sessions / Seminars In addition to the continuous assessment, you are expected to have read the following topics in advance of meeting the module coordinator / course lecturer at the seminars: Basic calculus and mathematics/statistics Fundamental finance concepts Fundamentals of accounting, especially the structure and elements found in financial statements Fundamentals of corporate finance (e.g. financial management decisions, investment appraisal techniques such as net present value and internal rate of return) Read the relevant chapters of the prescribed text and answer the assigned questions before coming to class. BSc modules are 10 ECTS the workload should reflect that fact. It is essential to set out the schedule to that students can plan their learning activities, especially those who are aiming to balance study and work demands. The readings detailed above have been assigned and students are expected to be fully familiar with them. These readings are an important learning source and supplement the session and text materials. 21 Student Engagement During the sessions, students are expected to be able to discuss issues arising from the assigned chapters and readings for the topics as scheduled above. Session participation is a vital element in the design of this module. Therefore, all students are expected to engage in class discussion and debate in order to facilitate the formation of their critical judgements. To support your learning, Power-Point slides will be available which (on certain occasions) may need to be upgraded / modified during or following the sessions depending on the issues raised. Office Hours Arrangements I will be available for upon the date(s)/time(s) below should you wish to meet me individually to discuss any aspect of this module. • Up to half an hour before the class starts, prior appointment is strictly required. 22 PART 4: ASSESSMENT DETAILS This module has three assessment components with specific weightings and marks awarded totalling 1001. The purpose of each assessment is as follows: • Individual Assignment aims to focus your learning by ensuring understanding of business structures and theories. You will be asked to evaluate business entities and display your ability to apply it to real situations through a variety of assessment strategies. Continuous Assessment is intended to promote inter-active learning through group work while assessing your understanding of directors’ duties and its’ academic versus practical applications. Continuous Assessment has been designed so that you will be assessed through multiple assessment types. These assessments may come in the form of a report, class participation, group work or any alternative combination. • Group Assignment aims to focus your learning by ensuring understanding of what you have learned during the sessions. • The Examination is the formal examination which aims to get insights on your understanding of issues (theory and practice) addressed in the module. Students are expected to complete all assessments that they are submitted by the specified date. All submissions must be typed, be well laid out, written in an academic style with appropriate headings (introduction, main part and concluding comments) and sections. Please ensure that all submissions are entirely your own work – for UCD’s policy on plagiarism click on the link below (please see Appendix 3 for further information on Plagiarism and the policy on the Late Submission of Coursework): http://libguides.ucd.ie/academicintegrity The weighting assigned for each component is shown in Table 2 below. (* I = Individual; G = Team) 1 As the Overseas Programme modules are worth 10 ECTS they should be graded out of 200 marks. 23 Table 2 – Assessment Components Assessment components Weighting Individual 1. Individual Assignment 30% I 2. Group Assignment 30% G 3. Examination 40% I *With regards to Continuous Assessments, students are asked to expect one final grade for this assessment component. All graded elements will be taken into consideration and calculated to create one final grade Module Assessment Components In the following pages, further details of each assessment component are presented along with expectations in relation to prior preparation and completion. 1. Individual assignment (30%) (Word limit: 2,000 words ± 10%) This assessment aims to provide students with an opportunity to develop an understanding of key concepts in finance, analyse various investment products based on the respective risk and return. You are expected to read beyond textbooks and able to apply the knowledge gain from real life examples either from your working environment or/and case studies read, and are able to demonstrate your competence in the areas indicated in the questions. You are encouraged to provide specific in-depth comments instead of general comments. You will need to write up to 2,000 words (± 10%) to address all the questions. 24 Requirement: Choose a country and examine the finance sector of that country. You need to show your understanding in the characteristics and efficiency of the finance sector, as well as examine the implementation of corporate governance in that country. Your assignment should include: Concept of a financial sector: development into a financial centre What are the Financial services available in (Country)? The Role of Stock Exchange The Role of Central Bank in developing the financial sector The Roles and Operations of the various Financial intermediaries/Institutions. What is the role of government in corporate governance? How businesses implement (effective) corporate governance? Recent economic development in (Country). 25 2. Group assignment (30%) (Word limit: 2,500 words ± 10%) This assessment aims to provide students with an opportunity to analyse various investment alternatives based on the respective risk and return so as to choose the most appropriate investment opportunity. You are expected to read beyond textbooks and able to apply the knowledge gain from real life examples either from your working environment or/and case studies read, and are able to demonstrate your competence in the areas indicated in the questions. You are encouraged to provide specific in-depth comments instead of general comments. Instructions to students: Form a group of 3 to 4 students, a. Download stock prices for any two companies from different industries, (preferably same economy) – 5 years of monthly closing prices for each company. You can use any database to obtain the prices e.g. datastream, yahoo finance (click the Investing tab followed by the Historical Prices tab) etc. Use the 5-year data to generate average monthly returns and standard deviations. Calculate the annualised mean return, standard deviation and correlation of the two stocks. Show your working clearly. b. Use investment proportions for the two stocks ranging from 0% to 100% (you may need a wider range say 0% to 150%) using intervals of 5%. Tabulate the investment opportunity set of the two stocks. Plot the investment opportunity set of the two stocks. Show your working clearly. c. Calculate the weights on the optimal risky portfolio consisting of the two stocks, denoted as stock 1 and stock 2, using the following formulae. Show your working clearly. .1 , ])()([x])([x])([ x])([x])([ 12 211221 2 12 2 21 21122 2 21 1 ww rrErrErrErrE rrErrE w ffff ff −= −+−−−+− −−− = σσρσσ σσρσ Show your working clearly for the calculation of the expected return and standard deviation of this optimal risky portfolio (ORP). Show and label clearly the optimal risky portfolio on the graph of the investment opportunity set of portfolios. 26 d. Calculate the weights on the minimum variance portfolio consisting of the two stocks, denoted as stock 1 and stock 2, using the following formulae. Show your working clearly. .1 , 2 12 2112 2 2 2 1 2112 2 2 1 ww w −= −+ − = σσρσσ σσρσ e. Calculate the expected return and standard deviation of this minimum variance portfolio (MVP). Show clearly the minimum variance portfolio on the same graph with ORP in (c) above. Identify the MVP, ORP and efficient frontier consisting of the portfolios made up of these two assets. Label them clearly on the graph. f. Discuss in details on diversification with reference to the efficient frontier and comparing the expected return and standard deviation of the optimal risky portfolio to the minimum-variance portfolio in your answer. You will need to write up to 2,500 words (± 10%) to address all the questions. Table 2B – Assignment Deadline Summary Continuous Assessment Deadlines Date Assignment Due Individual Assignment Tuesday, 28th December 2021 Group Assignment Tuesday, 4th January 2022 Examination Tuesday, 11th January 2022 The Assignments must be submitted in via Brightspace. See Assignment deadline in table 2B above. It is the student’s responsibility to retain a copy of any submitted assessment/project work. Please read the Grade Descriptors in the Assignment Grade Descriptor table. 27 3. Examination: The examination will focus on module themes and the material covered in the text, cases, assigned readings, videos and class discussions. For this, students are expected to demonstrate their understanding of theory and practice addressed throughout the module. The examination question format will be designed to allow you to show your understanding of the topics discussed and also reveal your learning (new and prior). More specific guidelines regarding the examination paper format and questions will be provided during the final session. Students will have the opportunity to ask questions about its design and style and be advised the type of answers expected. A recent past examination paper is included in Appendix 2 to this Study Guide, please be prepared for slightly different style of question. 28 PART 5: GRADING This section of the Study Guide provides students with details of the UCD grading system and also explains criterion referenced grading (UCD Policy). Under criterion referenced grading, students are graded on the quality of their work without reference to other students (norm referenced). For instance, the submission that meets the required guidelines in terms of writing style, analysis, description and / or summary will be awarded according to the standards set out. All students’ work is graded to indicate the standard attained using the criterion referenced approach. Table 3: UCD Grading System Module Grades Module Grade Grade Point Description A+ 4.2 Excellent A 4.0 A- 3.8 B+ 3.6 Very Good B 3.4 B- 3.2 C+ 3.0 Good C 2.8 C- 2.6 D+ 2.4 Acceptable D 2.2 D- 2.0 E 1.6 Unacceptable FM+ 0.0 Fail FM 0.0 FM- 0.0 NM 0.0 No grade - work submitted did not merit a grade ABS 0.0 No work was submitted by the student or the student was absent from the assessment 29 More specific grade descriptors are set out for your assessment components in the following pages. Table 4 below provides descriptors for Assignment – please read them prior to submitting your work. Table 4: Grade Descriptors –Assignment Grade Additional criteria more relevant to module levels 3 and 4 in the categories of analysis, synthesis and evaluation A+ An exceptionally deep and systematic engagement with the assessment task, with consistently impressive demonstration of a comprehensive mastery of the subject matter and discerning judgement, reflecting • a deep and broad knowledge and highly-developed critical insight, as well as effective synthesis of extensive reading • a critical comprehensive and perceptive appreciation of the relevant literature or theoretical, technical or professional framework • an exceptional ability to organise, analyse and succinctly present arguments fluently and lucidly with a high level of critical analysis, supported by very convincingly deployed evidence, citation or quotation • a highly-developed capacity for original, creative and logical thinking A A deep and systematic engagement with the assessment task, with consistently impressive demonstration of a comprehensive mastery of the subject matter, reflecting • a deep and broad knowledge and critical insight as well as extensive reading • a critical and comprehensive appreciation of the relevant literature or theoretical, technical or professional framework • an exceptional ability to organise, analyse and present arguments fluently and lucidly with a high level of critical analysis, amply supported by evidence, citation or quotation; • a substantial capacity for original, creative and logical thinking B A substantial engagement with the assessment task, demonstrating • a thorough familiarity with the relevant literature or theoretical, technical or professional framework • well-developed capacity to analyse issues, organise material, present arguments clearly and cogently well supported by evidence, citation or quotation • some original insights and capacity for creative and logical thinking C An intellectually competent and factually sound answer with, marked by • evidence of a reasonable familiarity with the relevant literature or theoretical, technical or professional framework • good developed arguments, but more statements of ideas • arguments or statements adequately but not well supported by evidence, citation or quotation • some critical awareness and analytical qualities • some evidence of capacity for original and logical thinking 30 D An acceptable level of intellectual engagement with the as task showing • some familiarity with the relevant literature or theoretical, technical or professional framework • mostly statements of ideas, with limited development of argument • limited use of evidence, citation or quotation • limited critical awareness displayed • limited evidence of capacity for original and logical thinking D- The minimum acceptable level of intellectual engagement the assessment task with • the minimum acceptable appreciation of the relevant literature or theoretical, technical or professional framework • ideas largely expressed as statements, with little or no developed or structured argument • minimum acceptable use of evidence, citation or quotation • little or no analysis or critical awareness displayed or is only partially successful • little or no demonstrated capacity for original and logical thinking FM An unacceptable level of intellectual engagement with the assessment task, with • no appreciation of the relevant literature or theoretical, technical or professional framework • no developed or structured argument • no use of evidence, citation or quotation • no analysis or critical awareness displayed or is only partially successful no demonstrated capacity for original and logical thinking PART 6: CONCLUDING COMMENTS This Study Guide is designed to assist and guide your learning for this module. It is important that you read it regularly and do so in conjunction with the core text, the assigned readings and session materials. Should you need clarification on issues covered, please let me know during the seminar sessions. I hope you enjoy the module and wish you good luck with the rest of your study and for the future. Dr. June Neo September 2021 31 APPENDIX 1: GROUP WORK – BEST PRACTICE GUIDELINES FOR STUDENTS 1. Rationale for group work: There are many reasons for using group work as part of a learning or assessment strategy – e.g. enhancing peer learning, creating a participative learning environment, encouraging debate and discussion, promoting social interaction, and developing students’ teamwork skills (e.g. negotiation, delegation and leadership). 2. Group formation: Groups may be allowed to self-form or they may be constituted through some form of random assignment. In the latter case, the assignment process may be structured to achieve some diversity within groups – for instance across areas such as ability, cultural background and gender – or on the basis of class attendance. 3. Managing the group: a) The onus is on the group to ensure that individual members fully contribute to the completion of the assigned task. b) Students must familiarise themselves with the College of Business teamwork model – https://qsblc.ucd.ie/videos/the-college-of-business-teamwork-model/ c) Effectively managing the group process and addressing challenges encountered throughout the process is part of developing collaborative skills. d) Groups must agree basic ground rules around communication procedures, performance targets, arranging and organising meetings, maintaining records of group activity, progress reports, solving problems, finalising the project and signing off on the final product. The group should also, at an early stage in the process, discuss issues around equity and fairness. e) Groups should draw up a team agreement and set milestones to use as moments for the group to review and identify emerging issues and assess progress. 32 f) Groups should assign roles to each member (such as leader, convener, facilitator, editor). g) Groups should maintain minutes of meetings, work plans etc. h) Individual members should maintain a journal of their own contribution. 4. Assessment of group work: a) The assessment of group work may involve the assessment of the ‘product’ of group work (i.e. the content covered by the group work activity and assessed by the module coordinator) and/or the assessment of the group work ‘process’ (i.e. participation in the group and assessed by group members). b) An individual assessment component (e.g. peer evaluation, individual reporting) may be included. c) Where group work contributes to a module grade, members will be awarded a grade that accurately reflects their contribution to the completion of the task. To address the problem of ‘free-riders’ within a group, differential grading may be applied by the Module Coordinator. 5. Dealing with problems within groups: a) Any student who is concerned about a member’s contribution to the group’s work must firstly communicate this to the group members. It can be helpful for the student to communicate this concern in writing to the rest of the group. The group must strive to resolve the problem within the group. b) The removal of a group member’s name from the cover page of a piece of coursework can only be done with the advance approval of the Module Coordinator. c) If a group member believes that his/her concerns have not been satisfactorily addressed within the group, the matter should be brought to the attention of the Module Coordinator in a timely manner. The Module Coordinator may request that this concern be raised with him/her in writing. d) Group problems cannot be solved retrospectively by the Module Coordinator. 6. Additional Resources: UCD College of Business #LearningInsights: Collaboration and Group work video resources: https://qsblc.ucd.ie/channels/#learning-insights 33 APPENDIX 2: TEAM AGREEMENT FOR TEAM X [DATE: ] TEAM MEMBERS CONTACT DETAILS MOBILE EMAIL 1 2 3 4 INFORMAL COMMUNICATION We have decided 1) 2) 3) MEETINGS We have decided 1) 2) 3) MAKING DECISIONS We have agreed 1) 2) 3) 4) 5) SANCTIONS We hope to work in harmony together. We have different strengths. We accept that this is a team piece of work and we are all responsible for doing our best. However we agree now that • If individuals have difficulties in working with the team or on the task, we will try to sort them out promptly by talking with each other • We will seek advice - as soon as is possible - from our tutor for those serious problems which we cannot resolve ourselves. SIGNED 34 APPENDIX 3: Two Additional Important Documents You are advised to read the following important documents before you commence your studies on this module: 1. Guidelines for the Late Submission of Coursework This document provides a detailed outline of the rules and regulations surrounding the presentation, submission and marking of assignments. The guidelines provided must be adhered at all times to avoid an unnecessary loss of marks. Further details on https://www.ucd.ie/t4cms/latesub_po.pdf 2. A Briefing Document for Students on Academic Integrity and Plagiarism. The University understands plagiarism to be the inclusion of another person’s writings or ideas or works, in any formally presented work (including essays, theses, examinations, projects, laboratory reports, oral, poster or slide presentations) which form part of the assessment requirements for a module or programme of study, without due acknowledgement either wholly or in part of the original source of the material through appropriate citation. Further details please go to http://libguides.ucd.ie/academicintegrity Plagiarism is a form of academic dishonesty. In any assignment, plagiarism means that you have presented information or ideas belonging to someone else falsely as being your own original thoughts on a subject. All assessments/projects submitted must be the result of your own work. The following statement must be included on the cover page of all assignments submitted: I declare that all materials included in this essay/report/project/dissertation is the end result of my own work and that due acknowledgement have been given in the bibliography and references to ALL sources be they printed, electronic or personal. Signed: Student name/s, student number Date: 35 APPENDIX 4: SAMPLE EXAMINATION PAPER Note to Students: Providing a copy of this paper does not signify that future papers will follow the exact same format. 36 SUMMER TRIMESTER EXAMINATION – 2021 Academic Year - 2020/21 BACHELOR OF BUSINESS STUDIES (Singapore) Intake 34 Full-Time FIN 2002S PRINCIPLES OF FINANCE Professor David McMillan Professor John Cotter Professor Cal Muckley Dr. June Neo* Time Allowed: 2 hours + 15 minutes reading time Instructions to candidates: Answer ONE compulsory question in Section A Answer any TWO (2) question in Section B Students are allowed to use non-programmable calculators • You are required to upload your answer file to Brightspace • You are only allowed to upload ONE file. • There is only one submission chance. Make sure to upload the correct file. • The submission folder will close sharp at the stipulated time. No extension will be given. • Non-submission will result in an ABS grade for the exam. • You must include a signed plagiarism statement in your answer file. • A 4-grade point penalty will be imposed for any late submission To upload your answer file, go to “Assessment – Assignment” of the respective module and you will then see an exam submission link. Click into the submission link to upload your file. 37 Section A (Compulsory question). 40 marks Question 1 You are asked to evaluate two mutually exclusive projects with the following cash flow streams. Year Project A ($) Project B ($) 0 20,000 15,000 1 7,000 $7,000 2 8,000 7,000 3 9,000 6,000 4 10,000 4,000 (a) Assume that the required rate of return is 12%. Evaluate the above two projects using the Payback period method, Net Present Value and Internal rate of return. Show your working clearly (14 marks) (b) Which project(s) should be chosen? Justify your answer. (8 marks) (c) Discuss the advantages and disadvantage of Net Present Value, Payback period and Internal rate of return methods. (6 marks) (d) In a survey by John Graham “Using CFO Surveys as a Motivational Tool to Teach Corporate Finance”, the author has discussed how to engage and motivate students with the results from corporate finance professionals. Provide your views on the practical relevance of discounted cash flow techniques (e.g. the Dividend discount model) and cost of equity models (e.g. Capital Asset Pricing Model, CAPM). (Hint: You may include the limitations on the empirical testing of CAPM) (12 marks) [Total 40 marks] 38 Section B (Answer any two questions) 30 marks each. Question 2 (a) Define corporate governance. (5 marks) (b) Discuss the role of board of directors in corporate governance. (25 marks) [Total 30 marks] Question 3 Assume an interest rate of 5 per cent annually, calculate the Present Value of the following cash flows: (a) $2,800 to be received at the end of each of the first 3 years, and $1,500 at the end of each of the years 5 to 8. Round your answer to 2 decimal places. (8 marks) (b) $3,200 to be received every year starting from year 3 to infinity. Round your answer to 2 decimal places. (8 marks) (c) Compare stocks and bonds as a financing tool for corporate borrowers. (14 marks) [Total 30 marks] 39 Question 4 The following information compares Mutual Fund Forever against the market portfolio using both standard deviation and beta as risk measures. Forever Market Portfolio Expected Return 16.8% 24% Standard Deviation 28.8% 24% Beta 0.6 1.00 (a) Discuss the risk of Forever Ltd against the market portfolio in terms of the standard deviation, systematic risk and unsystematic risk. (6 marks) (b) Comment on the risk of Forever Ltd against the market portfolio in terms of the beta. (8 marks) (c) Comment on the expected return of Forever Ltd shares against the expected return on the market portfolio. Is the expected return on Forever Ltd shares adequate? Justify your answer. (10 marks) (d) Based on the expected return of 14% of Forever Ltd and the related standard deviation and beta, will you invest in Forever Ltd? Provide your justification(s). (6 marks) [Total 30 marks] End of Paper
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