This book is about corporate finance. It focuses on how companies invest in real assets and how they raise the money to pay for these investments. It also provides a broad introduction to the financial landscape, discussing, for example, the major players in financial markets, the role of financial institutions in the economy, and how securities are traded and valued by investors. The book offers a framework for systematically thinking ahout most of the important financial prohlems that both firms and individuals are likely to confront. Financial management is important, interesting, and challenging. It is important because today?s capital investment decisions may determine the businesses that the firm is in 10, 20, or more years ahead. Also, a firm?s success or failure depends in largo part on its ability to fiad the capital that it needs. Finance is interesting for several reasons. Financial decisions often involve huge sums of money. Large investment projects or acquisitions may involve billions of dollars. Also, the financial community is international and fast-moving, with colorful herpes and a sprinkling of unpleasant villains. Finance is challenging. Financial decisions are rarely cut and dried, and the financial markets in which companies operare are changing rapidly. Good managers can cope with routine problems, but only the best managers can respond to change. To handle new problems, you need more than rules of thumh, you need to understand why companies and financial markets hehave as they do and when common practice may not be best practice. Once you have a consistent framework for making financial decisions, complex problems become more manageable. This book provides that framework. It is not an encyclopedia of finance. It focuses instead on setting out the basic principies of financial management and applying them to the main decisions faced by the financial manager. It explains why the firm?s owners would like the manager to increase firm value and shows how managers choose hetween investments that may pay off at different points of time or have different degrees of risk. It also describes the main features of financial markets and discusses why companies may prefer a particular source of finance.