The second edition of Fundamentals of Corporate Finance has been fully updated to include the latest research in the field. It brings to life the modern-day core principles covered in Corporate Finance courses outside the United States using a problem solving approach and student friendly writing style.

With an emphasis on the fundamentals of finance theory, this text uses intuitions of arbitrage, net present value, efficient markets and options to present corporate finance as the working of a small number of integrated and powerful intuitions. The basic intuitions are illustrated by events such as incorporation, the initial public offering, the initial dividend, a merger and/or acquisition, recapitalization and bankruptcy. This edition includes expanded coverage of derivatives and hedging using derivatives, IPC activity, Altman's bankruptcy predictor model, and how inflation and growth opportunities produce optimal capital structure.