The trade-off theory states that the optimal capital structure is a trade-off between interest tax shields and cost of financial distress . Companies may use debt financing to access funds quickly and at a lower cost of capital, but equity financing provides more flexibility and control over ownership.
The Trade-Off Theory of capital structure states that the firm value of a company can be maximized by determining its optimal mix of debt and equity. |
The trade-off theory of capital structure is the idea that a company chooses how much debt finance and how much equity finance to use by balancing the costs ... |
| Trade-off theory of capital structure |  |
Теория компромисса структуры капитала заключается в том, что компания выбирает, сколько долгового финансирования и сколько акционерного капитала использовать, уравновешивая затраты и выгоды. Википедия (Английский язык)
23 февр. 2021 г. · The trade-off theory of capital structure says that corporate leverage is determined by balancing the tax-saving benefits of debt against ... |
The prediction of the trade-off theory is that the optimal capital structure exists and is determined by the achievement of balance between tax benefits and ... |
The traditional tradeoff theory states that firms decide on their capital structure choices by trading-off the advantages of borrowing (e.g., tax savings) with ... |
The static trade-off theory and the pecking order theory are two financial principles that help a company choose its capital structure. |
Abstract. This paper seeks to analyse whether the capital structure decisions of Small and Medium-Sized Enterprises (SMEs) are closer to the assumptions of ... |
18 авг. 2023 г. · The trade-off theory stipulates that an underleveraged firm does not fully benefit from debt tax shields, while an overleveraged firm faces ... |
7 мая 2024 г. · We analyze the trade-off theory of capital structure with endogenous tax rates. In our model, the government first selects tax rates and then ... |
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