BUS2062 is Capella University's three-credit introduction to finance, focused on the core tools businesses use to value money, securities and investments.
The catalog says students gain and apply finance basics including the time value of money, stock and bond valuation techniques, and capital budgeting processes. They also demonstrate ways the relationship of domestic and global financial environments affects financial markets.
This page takes a calculation-first angle: the formulas you will meet, how to set them up, and how to explain what the numbers mean.
Course at a Glance
| Item | Details |
|---|---|
| University | Capella University |
| Course code | BUS2062 |
| Credits | 3 |
| Level | Undergraduate |
| Credit rule | Not available if you hold credit for BUS3062 |
| Typical work | Calculation problems in Excel, short analyses of markets or projects |
What BUS2062 Covers
| Topic | Core idea |
|---|---|
| Time value of money | A dollar today is worth more than a dollar later |
| Bond valuation | A bond's price is the present value of its coupons and face value |
| Stock valuation | A share's value reflects expected future dividends or cash flows |
| Capital budgeting | Choosing long-term investments with NPV, IRR and payback |
| Domestic and global environments | How interest rates, exchange rates and events abroad affect markets |
Worked Concepts
Present and Future Value
Future value grows a sum at an interest rate: FV = PV x (1 + r)^n. Present value reverses it: PV = FV / (1 + r)^n.
Example: $1,000 invested at 6% for 3 years grows to $1,000 x 1.06^3 = $1,191.02. Working backwards, $1,191.02 received in 3 years is worth $1,000 today at 6%.
Bond Pricing
Discount each coupon and the face value at the market rate. When the market rate is above the coupon rate, the bond sells below face value, and the reverse when it is below.
Example: A 3-year bond with a $1,000 face value pays a 5% annual coupon ($50). If market rates are 6%, its price is 50/1.06 + 50/1.06^2 + 1,050/1.06^3, about $973.27. The discount reflects the coupon being lower than the market rate.
Net Present Value
NPV discounts a project's expected cash flows at the required return and subtracts the initial cost. A positive NPV suggests the project adds value at that rate.
Example: A machine costs $10,000 and saves $4,000 a year for 3 years. At 8%, the present value of savings is about $10,308, so NPV is roughly $308. It is positive, but small, so a slightly higher required return would make it negative, which is worth mentioning.
Domestic and Global Financial Environments
The catalog's last strand asks how domestic and global conditions affect financial markets. Typical links to explain include:
- Central bank interest rate decisions and their effect on bond prices and borrowing costs.
- Exchange rate movements and their effect on companies that buy or sell abroad.
- Economic or political events in one country spreading through global markets.
Good answers trace a chain: event, effect on rates or prices, effect on a business or investor.
Example: If the central bank raises interest rates, existing bonds with lower coupons lose value, so their prices fall. Companies face higher borrowing costs, which raises the discount rate they use for projects. A project with a small positive NPV at 8% may no longer be worth doing at 10%, so investment plans can be delayed.
Use a real, recent example where you can, and cite a reputable source such as a central bank statement or a major financial news outlet.
Typical Assignments and How to Approach Them
| Type of task | What it tests | How to approach it |
|---|---|---|
| TVM problems | Correct use of formulas | Write down PV, FV, r and n before calculating |
| Valuation exercise | Pricing bonds or shares | Lay out each cash flow and its discount factor |
| Capital budgeting case | Choosing between projects | Use NPV first, then IRR and payback as support |
| Market analysis | Linking events to markets | Explain the cause-and-effect chain with a real example |
Where Students Get Stuck
- Mismatched periods. Monthly payments need a monthly rate and number of months.
- Sign conventions in Excel. PV and FV functions return negatives for cash outflows; understand why.
- Numbers without meaning. Always say what a result implies for the decision.
- Ignoring assumptions. Note the discount rate and cash-flow estimates that drive the answer.
Study Tips for BUS2062
- Do every TVM problem twice: once by formula, once with Excel functions.
- Build a reusable NPV template with labeled input cells.
- Follow one financial news story a week and link it to course concepts.
- Keep a formula sheet with a worked example under each formula.
How We Help with BUS2062
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Frequently Asked Questions
Capella's catalog lists BUS2062 at 3 credits.
No. The catalog states that students who have received credit for BUS3062 may not take BUS2062.
The principle that money available now is worth more than the same amount later, because it can earn a return.
Its fixed payments are discounted at a higher rate, so their present value falls.
NPV is generally preferred because it measures value added in dollars; IRR and payback are useful supporting measures.
No. We provide worked models and tutoring so you can complete your own work.