This course focuses on how companies invest in real assets (investment decision) and how they raise the money to pay for these investments (financing decision). It is organized in five parts. Part 1 (Chapters 1-4) provides essential background material. Part 2 (Chapters 5-10) is concerned with valuation. Part 3 (Chapters 11-13) discusses the cost of capital. Part 4 (Chapters 14 and 15) begins our discussion of the financing decision. Part 5 (Chapters 16 and 17) focuses on the two classic long-term financing decisions: debt and payout policy. This course is a full year program. In the first semester, Parts 1 and 2 will be covered.