This corporate-finance course focuses on corporate policy and the tactics that increase the value of the corporation. The course starts by stressing how managers interface with the capital markets to learn the return required by the firm’s different investors. This required return, or cost of capital, is used later as the key variable to assess whether capital-investment proposals can create value for stakeholders. This illustrates the process of the manager’s relying on the informational efficiency of the capital markets to communicate the minimum return on investment that can create value within the firm. Students explore a two-stage process for the optimal capital-structure decision, where managers must first project future funding needs for the company, after which they can turn their attention to creating the optimal mix of debt and equity to fund those needs and enhance shareholders’ wealth. Students are shown how investment and financing policies can interact by overlaying large investment decisions (mergers and acquisitions) with the decision of how to finance the transaction.