Looks at the essential aspects of financial decision-making. Financial mathematics is used to value securities and make capital expenditure decisions. Portfolio theory is introduced to provide a foundation for determining the relationship between expected risk and returns in financial and real asset investments. Dividend payouts and the choices between debt and equity financing are covered. Includes: factors affecting the formulation of the capital structure and the influence of the capital market environment. The implications of financial risk, taxation and the conflict of interest between managers and investors on the value of business firms are introduced.