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Marcy and Dan were high school sweethearts who married young and built a life together. Between Marcy's work as a waitress and Dan's as an electrician, they have raised their now-teenage children with a lot of hard work and sacrifice. While at lunch with a group of friends, Marcy hears about her friend Diane's mother, who, due to a lifetime of poor financial planning, has had to move in with Diane, putting a strain on Diane's finances and marriage. While saddened to hear about her friend's misfortunes, Marcy realizes she needs to consider her and Dan's future and their lack of retirement savings. She and Dan meet with a financial planner for help with retirement planning, and they learn about their options for saving and investing.

This case series simulates the decision of choosing and financing a car. Reggie Fuller is a fry cook on the verge of losing his job if he keeps arriving late to work due to inconsistent public buses. Fuller's dream car, the Lincoln MKS, is priced far beyond his budget ($50,000), but Fuller wonders if he can afford other new cars like the Nissan Altima (which costs $17,445) or the Toyota Camry (which costs $20,306). Unsure of how to proceed, Fuller seeks the advice of a family friend and mentor, who agrees to teach him what he knows about the car-financing process. Accompanying the case is a handout that teaches students how to calculate monthly auto loan payments.

In this case, fry cook Reggie Fuller, who wants to buy a car to ensure that he can consistently get to work on time, asks his mother if she and his sister would like to chip in with him so that he can afford a new Nissan Versa, a cheaper alternative to some of the other new cars he's been looking at. Fuller's mother responds by raising scheduling concerns along with car-related costs outside of monthly payments, such as gas, maintenance, and insurance. Staring down the realization that he just may not be able to afford a new car, Fuller wonders if he should reconsider the idea of getting a used car instead, and asks his friend, an auto mechanic, to educate him on pre-owned vehicles.

In September 2017, a senior portfolio manager at Portland Capital Management had all her attention focused on the upcoming initial public offering (IPO) of Roku, Inc. The company had just updated its initial filing to indicate an offer price between $12 and $14, and Portland Capital Management had an opportunity to take a substantial position in that offering. She saw the upside potential in Roku's shift from hardware-related revenue streams (player sales) to platform-related revenue streams (advertising and content purchases made on the platform). But she was also well aware of the riskiness of this strategy and the uncertain state of IPO markets at that time.

Student spreadsheet for case UV7911.

This case follows dance instructor Jackie McKenzie as she struggles to properly budget her expenses needed to support life with her youngest daughter, Millie. At the checkout aisle of her local grocery store, McKenzie becomes embarrassed when she discovers she cannot afford the $150 bill. Luxury purchases such as a red dress and McKenzie's bimonthly pedicures have maxed her credit card and strained her checking and savings accounts. Unfortunately, this is not the first time McKenzie has overspent her means. When McKenzie calls her oldest daughter, Kerry, to ask yet again for her financial help, Kerry challenges her mother to put together a budget.

David Simmons is a waiter at a struggling Italian restaurant located down the block from where he lives. Money is tight for him right now, as his limited income means he lives paycheck to paycheck. However, David knows things will look up for him soon because he was recently offered a job as a bank teller across town-his first desk job. This case helps students learn about building credit. The case addresses what a FICO score is, who computes it, how it is determined, and what it is used for.

This case follows a woman named Maria Alvarez as she explores financing options to cover costs for her young daughter's surprise respiratory illness. Alvarez has not opened a bank account since moving to the United States from the Dominican Republic two years prior and has little savings from her job. She lives paycheck to paycheck without a credit card or credit history, to her knowledge. Should Alvarez get the money she needs through a payday loan, which wouldn't require her to have a bank account, or should she explore what it would be like to join a financial institution and get a personal loan through it?

This case follows the recently married Shane and Erin as they explore the world of credit cards. Shane, a musician with an irregular salary and a spotty job history, was raised to avoid credit by his parents who had emigrated from a communist Eastern Europe. Erin, a marketing manager in a baby-formula company, has a steady salary but knows little about credit cards. Shane offers to do some research and report back in a week. This case reveals the complexity of the credit card business and the risks and rewards to a consumer that uses a financial product. In particular, users should recognize that the risk of having a credit card is how it might influence their consumption behavior. Credit cards offer a variety of conveniences, but they are an expensive form of short-term debt that can become an onerous burden if used beyond the means of the cardholder. Thus prudent use of credit cards is a key learning objective of both the A and B cases.

B case to case UV7812 This case continues the story of Shane and Erin as they learn about credit cards. In the A case, Shane researched credit cards and explained the fine print from the disclosures to his wife Erin, a marketing manager in a baby-formula company. The B case begins with Erin interested in choosing the best credit card that offers airline miles in order to earn a free beach trip. Three cards are presented (case Exhibit 1) with different options, though the annual percentage rate (APR) is unknown until an application is made. To compare the three offers, Shane attempts to measure the costs and benefits of each card assuming the couple spends as much as $500 and pays 75% back ($350) per month. This case reveals the complexity of the credit card business and the risks and rewards to consumers. In particular, students should recognize that the risk of having a credit card is how it might influence their consumption behavior. Credit cards offer a variety of conveniences, but they are an expensive form of short-term debt that can become an onerous burden if used beyond the means of the card owner. Thus prudent use of credit cards is a key learning objective of both the A and B cases.

The Chevron Corporation and Occidental Petroleum entered into a bidding competition in April 2019 for ownership and control of Anadarko Petroleum. Both companies wished to expand their acreage and reserves in the Permian Basin, the core assets of Anadarko, and the largest oil producing region in the world. Although Anadarko first announced that it was accepting Chevron's offer, Occidental quickly publicized its own offer which it argued was superior. After revising its offer to increase the cash component, Anadarko accepted Occidental's offer. Anadarko stockholders had to vote on August 8 to accept or reject the sale of their company to Occidental Petroleum.

At-Bay was a cyber insurance startup that offered companies coverage against a wide array of cyber risks-exposure to which the firm was able to quickly assess and price on the basis of technical expertise that traditional insurance carriers lacked. In mid-2019, At-Bay was working to build underwriting revenue ahead of a Series B round of venture funding that the company hoped to receive by year's end. This required not only scaling its underwriting capacity and convincing insurance brokers to include the startup among the carriers they quoted to their corporate clients, but also ensuring that At-Bay avoided the temptation to grow revenues by taking on riskier clients than it might otherwise prefer.

Assessing the performance of private equity (PE) investments is a challenging task. It starts with the fact that the assets are privately held and illiquid. By contrast, public equity valuations are determined in a vast open market populated largely by disinterested investors acting on publicly available information. Therefore, to make an informed assessment about PE performance, investors should be aware of the areas where general partners' discretion can most influence fund performance. As PE has grown as an asset class, investors have pushed for greater disclosure and more standardization of performance metrics and benchmarks. Although this has resulted in greater standardization of the reported information, considerable opportunity remains for general partners to influence fund returns. This note summarizes the key metrics used in assessing PE performance and discusses important areas of general partners' influence on reported returns.

Student spreadsheet to case UV7808

A daughter teaches her mother how to handle her finances by creating a budget.

On March 29, 2012, the chief executive officer of London Mining, an iron ore mining firm based in the United Kingdom, was considering an innovative financing offer from BlackRock World Mining Trust, an investment firm owned by asset manager BlackRock. The offer was a royalty agreement that would see BlackRock pay US$110 million to London Mining in exchange for 2 per cent of iron ore revenues from the Marampa mine in Sierra Leone. The company was looking at raising $250 million in debt and funding the remainder through a combination of free cash flow, convertible debt, or an equity issue. The opportunity to sell a portion of the revenues as part of a royalty agreement seemed appealing. The chief executive officer’s challenge was to evaluate the advantages and disadvantages of agreeing to the royalty arrangement.

On March 29, 2012, the chief executive officer of London Mining, an iron ore mining firm based in the United Kingdom, was considering an innovative financing offer from BlackRock World Mining Trust, an investment firm owned by asset manager BlackRock. The offer was a royalty agreement that would see BlackRock pay US$110 million to London Mining in exchange for 2 per cent of iron ore revenues from the Marampa mine in Sierra Leone. The company was looking at raising $250 million in debt and funding the remainder through a combination of free cash flow, convertible debt, or an equity issue. The opportunity to sell a portion of the revenues as part of a royalty agreement seemed appealing. The chief executive officer's challenge was to evaluate the advantages and disadvantages of agreeing to the royalty arrangement.

In January 2018, the account manager at the Commercial Bank of Canada was reviewing a request for a $200,000 long-term loan and a $60,000 working capital loan for The Church Key Bistro-Pub, a fine dining restaurant located in downtown London, Ontario. The funds were needed to open a second restaurant. The account manager believed the restaurant owner to be a reliable business manager. Her enthusiasm for the new restaurant was infectious, and her expertise in restaurant management was indisputable. Nonetheless, the account manager was hesitant to grant debt financing to a company that had not taken out any debt in six years. She considered all available information and began her final review.

The case is set in April 2018 when, after a 5-year streak of investing success and resultant strong asset inflows, the performance Asia Alpha Management Pvt. Ltd. (AAM), a fictitious hedge fund, begins to lag from the beginning of the year. AAM's co-Founder and Chief Investment Officer, Royston Lim, is struggling to decide what to do with three large positions in his portfolio that are underperforming. Each of these positions is constructed to illustrate the real-world impact of behavioural bias on investment management. Case (A) provides background information on the firm and detailed information on the three positions. After a class discussion on Case (A) to decide what Lim should do, Case (B) describes what actually happened. The concept of behavioural bias is introduced through the subsequent discussion of why Lim made the decisions he made.