Higher Education


Financial Management: Theory and Practice, 15E

Author(s): Eugene F. Brigham | Michael C. Ehrhardt

ISBN: 9789391566111

15th Edition

Copyright: 2017

India Release: 2021


Binding: Paperback

Pages: 1220

Trim Size: 254 x 203 mm

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The only text to strike a balance between solid financial theory and practical applications, Brigham/Ehrhardt’s FINANCIAL MANAGEMENT: THEORY AND PRACTICE, 15e gives you a thorough understanding of the essential concepts you need to develop and implement effective financial strategies. The book begins with a presentation of corporate finance fundamentals before progressing to discussions of specific techniques used to maximize the value of a firm. It also explores the recent financial and economic crises and the role of finance in the business world. With its relevant and engaging presentation, numerous examples, and emphasis on Excel usage, this text serves as a complete reference tool for you in your academic or business career.

  • FLEXIBLE COVERAGE MAKES THE TEXT IDEAL FOR ONE-SEMESTER OR TWO-SEMESTER COURSES. Organized to address key concepts and essential topics within the first 17 chapters, the text ensures your students receive the coverage they need whether you teach a one-semester or two-semester course. Later chapters provide more advanced and expanded treatment of topics to build upon earlier material and increase student mastery of concepts.
  • UNMATCHED AUTHOR EXPERTISE ENSURES CLEAR, CONTEMPORARY APPROACH. This premier authorship team combines the extensive teaching background and more than 30 years of text writing experience of Dr. Gene Brigham with the contemporary scholarship and practical, professional expertise of Dr. Mike Ehrhardt. Together, these authors deliver a consistent, accurate and innovative approach that will keep your students first in finance.
  • RELEVANT EXAMPLES REFLECT TODAY’S GLOBAL ECONOMIC ENVIRONMENT. Updated, timely real-world examples throughout almost every chapter demonstrate the impact of today’s financial crisis in all areas of business and life. "Global Economic Crisis" boxes in many chapters highlight specific finance issues related to today’s economic environment.
  • INCREASED CORPORATE GOVERNANCE COVERAGE IS INTEGRATED THROUGHOUT. Reflecting the latest headlines, up-to-date coverage is packed with real-world illustrations and gives students in-depth insight into this key topic.
  • NEW DESIGN TRULY ENGAGES READERS. A refreshed, easier-to-read interior design makes the Fourteenth Edition of the popular FINANCIAL MANAGEMENT: THEORY & PRACTICE more accessible and student friendly than ever.


CHAPTER 1 An Overview of Financial Management and the Financial Environment

Web Extensions 1A: An Overview of Derivatives

CHAPTER 2 Financial Statements, Cash Flow, and Taxes

Web Extension 2A: The Federal Income Tax System for Individuals

CHAPTER 3 Analysis of Financial Statements


CHAPTER 4 Time Value of Money

Web Extensions 4A: The Tabular Approach

4B: Derivation of Annuity Formulas

4C: Continuous Compounding

CHAPTER 5 Bonds, Bond Valuation, and Interest Rates

Web Extensions 5A: A Closer Look at Zero Coupon and Other OID Bonds

Web Extensions 5B: A Closer Look at TIPS: Treasury Inflation-Protected Securities

Web Extensions 5C: A Closer Look at Bond Risk: Duration

Web Extensions 5D: The Pure Expectations Theory and Estimation of Forward Rates


CHAPTER 6 Risk and Return

Web Extensions 6A: Continuous Probability Distributions

Web Extensions 6B: Estimating Beta with a Financial Calculator

CHAPTER 7 Corporate Valuation and Stock Valuation

Web Extension 7A: Derivation of Valuation Equations

CHAPTER 8 Financial Options and Applications in Corporate Finance


CHAPTER 9 The Cost of Capital

Web Extension 9A: The Required Return Assuming Nonconstant Dividends and Stock Repurchases

CHAPTER 10 The Basics of Capital Budgeting: Evaluating Cash Flows

Web Extension 10A: The Accounting Rate of Return (ARR)

CHAPTER 11 Cash Flow Estimation and Risk Analysis

Web Extension 11A: Certainty Equivalents and Risk-Adjusted Discount Rates


CHAPTER 12 Corporate Valuation and Financial Planning

CHAPTER 13 Corporate Governance


CHAPTER 14 Distributions to Shareholders: Dividends and Repurchases

CHAPTER 15 Capital Structure Decisions

Web Extension 15A: Degree of Leverage

Web Extension 15B: Capital Structure Theory: Arbitrage Proofs of the Modigliani-Miller Theorems


CHAPTER 16 Supply Chains and Working Capital Management

Web Extension 16A: Secured Short-Term Financing

CHAPTER 17 Multinational Financial Management


CHAPTER 18 Public and Private Financing: Initial Offerings, Seasoned Offerings, and Investment Banks

Web Extensions 18A: Rights Offerings

CHAPTER 19 Lease Financing

Web Extensions 19A: Leasing Feedback

Web Extensions 19B: Percentage Cost Analysis

Web Extensions 19C: Leveraged Leases

CHAPTER 20 Hybrid Financing: Preferred Stock, Warrants, and Convertibles

Web Extensions 20A: Calling Convertible Issues


CHAPTER 21 Dynamic Capital Structures and Corporate Valuation

Web Extensions 21A: Projecting Consistent Debt and Interest Expenses

CHAPTER 22 Mergers and Corporate Control

CHAPTER 23 Enterprise Risk Management

CHAPTER 24 Bankruptcy, Reorganization, and Liquidation

Web Extensions 24A: Multiple Discriminant Analysis


CHAPTER 25 Portfolio Theory and Asset Pricing Models

CHAPTER 26 Real Options

Web Extensions 26A: The Abandonment Real Option

Web Extensions 26B: Risk-Neutral Valuation


APPENDIX A Solutions to Self-Test Problems

APPENDIX B Answers to End-of-Chapter Problems

APPENDIX C Selected Equations

APPENDIX D Values of the Areas under the Standard Normal Distribution Function



Name Index

Subject Index


CHAPTER 27 Providing and Obtaining Credit

CHAPTER 28 Advanced Issues in Cash Management and Inventory Control

CHAPTER 29 Pension Plan Management

CHAPTER 30 Financial Management in Not-for-Profit Businesses

Eugene F. Brigham, University of Florida

Dr. Eugene F. Brigham is graduate research professor emeritus at the University of Florida, where he has taught since 1971. He received his M.B.A. and Ph.D. from the University of California-Berkeley and his undergraduate degree from the University of North Carolina. Prior to joining the University of Florida, Dr. Brigham held teaching positions at the University of Connecticut, the University of Wisconsin and the University of California-Los Angeles. A former president of the Financial Management Association, he has written many journal articles on the cost of capital, capital structure and other aspects of financial management. He has authored or co-authored 10 textbooks on managerial finance and managerial economics that are used at more than 1,000 universities in the United States and have been translated into 11 languages worldwide. In addition to his academic writing, Dr. Brigham continues to teach, consult and complete research. He has served as a consultant to many corporations and government agencies, including the Federal Reserve Board, the Federal Home Loan Bank Board, the U.S. Office of Telecommunications Policy and the RAND Corp. He has also testified as an expert witness in numerous electric, gas and telephone rate cases at both federal and state levels. Dr. Brigham spends his spare time on the golf course, enjoying time with his family and dogs and tackling outdoor adventure activities, such as biking through Alaska.


Michael C. Ehrhardt

Dr. Michael C. Ehrhardt is a Professor Emeritus and current faculty member in two Executive MBA programs at the University of Tennessee. He received a B.S. in Civil Engineering and a B.A. in Economics at Swarthmore College. After working several years as an engineer, he earned his M.S. in Operations Research and Ph.D. in Finance from the Georgia Institute of Technology. Dr. Ehrhardt has taught extensively at the undergraduate, master's and doctoral levels in the areas of investments, corporate finance and capital markets. He has directed and served on numerous dissertation committees. Dr. Ehrhardt teaches in executive education programs and consults in the areas of corporate valuation, value-based compensation plans, financial aspects of supply chain management and the cost of capital. His honors include the Allen G. Keally Outstanding Teacher Award, the Tennessee Organization of MBA Students Outstanding Faculty Award, the College of Business Administration Research & Teaching Award and the John B. Ross Outstanding Teaching Award in the College of Business. An author and co-author of several books addressing various areas of finance, Dr. Ehrhardt focuses much of his research on corporate valuation and asset pricing models, including pricing models for interest-rate sensitive instruments. His work has been published in numerous journals, including THE JOURNAL OF FINANCE, JOURNAL OF FINANCIAL AND QUANTITATIVE ANALYSIS, FINANCIAL MANAGEMENT, THE FINANCIAL REVIEW, THE JOURNAL OF FINANCIAL RESEARCH and THE JOURNAL OF BANKING AND FINANCE.