Abstract
This note discusses the Modigliani-Miller capital structure irrelevance propositions and highlights the underlying assumptions. The tax shield benefit and financial distress costs, including agency related costs, of debt financing are then discussed. The note concludes with some guidelines for an optimal capital structure.
Additional Information
| Product Type | Technical Note |
|---|---|
| Reference No. | F&A0428TEC |
| Title | Capital Structure |
| Pages | 5 |
| Published on | Feb 8, 1996 |
| Authors | Sinha, Sidharth; |
| Area | Finance and Accounting (F&A) |
| Discipline | Finance, Operations Management |
| Sector | Public Sector |
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