---
title: "FINC 160 · How money and markets work"
publisher: Maestro College (Maestro Open)
lessons: 41
source: https://open.maestrocollege.edu/how-money-and-markets-work
full: https://open.maestrocollege.edu/how-money-and-markets-work/llms-full.txt
---

# How money and markets work (FINC 160)

Value cash over time, judge whether an investment is worth making, price risk, and plan how to fund a business.

Corporate Finance examines financial decision-making in business organizations. Students explore investment analysis, financial planning, capital structure, risk management, and advanced financial modeling and analysis tools.

## Course objectives
- Evaluate business investment decisions using cash-flow analysis and time-value-of-money principles.
- Develop spreadsheet-based financial models that connect operating assumptions, project cash flows, financing, and liquidity forecasts.
- Apply capital-budgeting methods to assess project value and compare competing investment alternatives.
- Estimate required returns and incorporate risk, capital costs, and sensitivity analysis into financial decisions.
- Assess financing alternatives, leverage, and liquidity constraints to support sustainable funding decisions.
- Validate financial analyses and communicate evidence-based recommendations to non-financial stakeholders.

## Course teaching approach
- Start from a real-world problem, then introduce the concept as the solution.
- Keep it true beginner level, hands-on, a little gamified. The learner should feel they are winning.
- Balance explanation, demonstration and practice. No copy-paste exercises: give small story-based tasks.
- End with one fun closed question about the topic.

## Lessons
### Unit 1: Making money count: value cash over time
- [Shareholder value as the goal](https://open.maestrocollege.edu/how-money-and-markets-work/shareholder-value-as-the-goal.md)
- [Cash flow vs. accounting profit](https://open.maestrocollege.edu/how-money-and-markets-work/cash-flow-vs-accounting-profit.md)
- [Opportunity cost: choosing a discount rate](https://open.maestrocollege.edu/how-money-and-markets-work/opportunity-cost-choosing-a-discount-rate.md)
- [Future value: how compounding grows money](https://open.maestrocollege.edu/how-money-and-markets-work/future-value-how-compounding-grows-money.md)
- [Present value: discounting future cash](https://open.maestrocollege.edu/how-money-and-markets-work/present-value-discounting-future-cash.md)
- [Annuities: valuing level payment streams](https://open.maestrocollege.edu/how-money-and-markets-work/annuities-valuing-level-payment-streams.md)
- [Spreadsheet PV and FV functions](https://open.maestrocollege.edu/how-money-and-markets-work/spreadsheet-pv-and-fv-functions.md)
- [Challenge: pricing a payment plan](https://open.maestrocollege.edu/how-money-and-markets-work/challenge-pricing-a-payment-plan.md)

### Unit 2: Making the investment call: evaluate projects
- [Incremental project cash flows](https://open.maestrocollege.edu/how-money-and-markets-work/incremental-project-cash-flows.md)
- [After-tax operating cash flow](https://open.maestrocollege.edu/how-money-and-markets-work/after-tax-operating-cash-flow.md)
- [Building project cash flows](https://open.maestrocollege.edu/how-money-and-markets-work/building-project-cash-flows.md)
- [Payback period](https://open.maestrocollege.edu/how-money-and-markets-work/payback-period.md)
- [Net present value (NPV)](https://open.maestrocollege.edu/how-money-and-markets-work/net-present-value-npv.md)
- [Internal rate of return (IRR)](https://open.maestrocollege.edu/how-money-and-markets-work/internal-rate-of-return-irr.md)
- [Profitability index](https://open.maestrocollege.edu/how-money-and-markets-work/profitability-index.md)
- [Comparing mutually exclusive projects](https://open.maestrocollege.edu/how-money-and-markets-work/comparing-mutually-exclusive-projects.md)
- [Challenge: venture expansion decision](https://open.maestrocollege.edu/how-money-and-markets-work/challenge-venture-expansion-decision.md)

### Unit 3: Pricing risk: set required returns and WACC
- [Risk and return basics](https://open.maestrocollege.edu/how-money-and-markets-work/risk-and-return-basics.md)
- [Diversification: which risk gets rewarded](https://open.maestrocollege.edu/how-money-and-markets-work/diversification-which-risk-gets-rewarded.md)
- [Cost of equity with CAPM](https://open.maestrocollege.edu/how-money-and-markets-work/cost-of-equity-with-capm.md)
- [After-tax cost of debt](https://open.maestrocollege.edu/how-money-and-markets-work/after-tax-cost-of-debt.md)
- [Weighted average cost of capital (WACC)](https://open.maestrocollege.edu/how-money-and-markets-work/weighted-average-cost-of-capital-wacc.md)
- [WACC as the hurdle rate](https://open.maestrocollege.edu/how-money-and-markets-work/wacc-as-the-hurdle-rate.md)
- [Sensitivity analysis: which input matters most](https://open.maestrocollege.edu/how-money-and-markets-work/sensitivity-analysis-which-input-matters-most.md)
- [Scenario analysis: best, base and worst case](https://open.maestrocollege.edu/how-money-and-markets-work/scenario-analysis-best-base-and-worst-case.md)
- [Break-even: how much room for error](https://open.maestrocollege.edu/how-money-and-markets-work/break-even-how-much-room-for-error.md)
- [Challenge: stress-testing the project](https://open.maestrocollege.edu/how-money-and-markets-work/challenge-stress-testing-the-project.md)

### Unit 4: Funding the future: finance and plan
- [Debt or equity: choosing a funding source](https://open.maestrocollege.edu/how-money-and-markets-work/debt-or-equity-choosing-a-funding-source.md)
- [Loan payments: what each offer really costs](https://open.maestrocollege.edu/how-money-and-markets-work/loan-payments-what-each-offer-really-costs.md)
- [Financial leverage: how borrowing boosts returns](https://open.maestrocollege.edu/how-money-and-markets-work/financial-leverage-how-borrowing-boosts-returns.md)
- [Can we cover the interest?](https://open.maestrocollege.edu/how-money-and-markets-work/can-we-cover-the-interest.md)
- [Finding the best debt mix](https://open.maestrocollege.edu/how-money-and-markets-work/finding-the-best-debt-mix.md)
- [Financial distress costs](https://open.maestrocollege.edu/how-money-and-markets-work/financial-distress-costs.md)
- [Profitable but out of cash](https://open.maestrocollege.edu/how-money-and-markets-work/profitable-but-out-of-cash.md)
- [Cash flow forecasting](https://open.maestrocollege.edu/how-money-and-markets-work/cash-flow-forecasting.md)
- [Building an integrated financial plan](https://open.maestrocollege.edu/how-money-and-markets-work/building-an-integrated-financial-plan.md)
- [Challenge: financing the venture](https://open.maestrocollege.edu/how-money-and-markets-work/challenge-financing-the-venture.md)

### Unit 5: Making the call: validate and recommend
- [Model validation with AI review](https://open.maestrocollege.edu/how-money-and-markets-work/model-validation-with-ai-review.md)
- [Writing a finance recommendation](https://open.maestrocollege.edu/how-money-and-markets-work/writing-a-finance-recommendation.md)
- [Challenge: when the numbers change](https://open.maestrocollege.edu/how-money-and-markets-work/challenge-when-the-numbers-change.md)
- [Challenge: board pitch and defense](https://open.maestrocollege.edu/how-money-and-markets-work/challenge-board-pitch-and-defense.md)

## How to use this document
You are acting as a tutor for a learner on Maestro Open. Teach from this document, one small step at a time. Ask the learner to try things, wait for their answer, then give feedback. Keep it beginner-friendly. If the lesson involves code or spreadsheets and you cannot run them, ask the learner to try it on their own computer and paste the result back. Do not award grades, credit or certificates.
Start with lesson 1 unless the learner asks for a specific lesson. Keep track of which lesson you are on.

## When a lesson is done
Teach one lesson at a time. A lesson is complete only when the learner has shown they can do every outcome listed for it; check each with a small task or question.
When it is complete:
1. Say clearly: "Lesson N complete: <lesson title>." (use the lesson's number and title).
2. Give a two-line recap of what they learned.
3. Name the next lesson, say "Lesson N+1 of 41: <title>", and ask if they're ready to start it. Start it only when they say yes.
After the last lesson, congratulate them on finishing the course.