NEW TO THE THIRTEENTH EDITION
As we made plans to publish the thirteenth edition, we carefully assessed market feedback about content changes that would better meet the needs of instructors teaching the course. The chapter sequence is similar to the prior edition, but there are some note- worthy changes. The thirteenth edition contains 19 chapters divided into eight parts. Each part is introduced by a brief overview, which is intended to give stu- dents an advance sense for the collective value of the chapters included in the part. In Part 1, a new Chapter 2 expands coverage of financial markets and insti- tutions, with particular emphasis on the recent financial crisis and recession. This chapter not only explores the root causes and consequences of the financial crisis, but it also discusses the changing regulatory landscape within which financial institutions and markets function. Part 2 contains three chapters in the same order in which they appeared in the twelfth edition. These chapters focus on basic financial skills such as financial statement analysis, cash flow analysis, and time-value-of-money calculations. Part 3 focuses on bond and stock valuation. We moved these two chapters forward in this edition, just ahead of the risk and return chapter, to provide stu- dents with exposure to basic material on bonds and stocks that is easier to grasp than some of the more theoretical concepts in the next part.
Part 4 contains the risk and return chapter as well as the chapter on the cost of capital, which we have moved forward to lead into Part 5 on capital budg- eting. We also moved up the chapter on the cost of capital so that it follows directly on the heels of the risk and return material. We believe that this makes the subsequent discussion of capital budgeting topics more meaningful because students will already have an idea of where a project “hurdle rate” comes from. Part 5 contains three chapters on various capital budgeting topics. A change from the last edition here is that we present capital budgeting methods before the chapter on capital budgeting cash flows. Parts 6, 7, and 8 contain the same seven chapters in the same order that appeared in the latter part of the twelfth edition. These chapters cover topics such as capital structure, payout policy, working capital management, derivatives, mergers, and international finance. Details about the revisions made to these chapters appear below. Although the text content is sequential, instructors can assign almost any chapter as a self-contained unit, enabling instructors to customize the text to var- ious teaching strategies and course lengths. A number of new topics have been added at appropriate places, and new fea- tures appear in each chapter. The Matter of Fact feature provides additional detail and interesting empirical facts that help students understand the practical implica- tions of financial concepts. For students who want to explore particular topics more deeply on their own, the In More Depth feature, available on MyFinanceLab, offers a guide for further study. In addition, as the detailed list shows, the chapter- opening vignettes and In Practice boxes have been replaced or heavily revised: For example, three-quarters of the chapter-opening vignettes are new, focusing on com- panies such as Facebook, Abercrombie & Fitch, and Air Asia that have student appeal, and more than half of the Focus on Ethics boxes are new. Also new to this edition are Opener-in-Review questions, which appear at the end of each chapter. The following chapter-by-chapter list details several of the notable content changes in the thirteenth edition.