0
Still curious? Ask our experts.
Chat with our AI personalities
Beau
Rafa
RossAdd your answer:
Earn +20 pts
How do you calculate optimal capital structure?
very carefully
Higgins Office Corp Plans to maintain its optimal capital structure of 40 percent debt 10 percent preferred stock and 50 percent common equity indefinitely?
10.64%
What are the three elements of health?
The three elements of health are: body structure, body chemistry, and the mental. It is believed that all 3 are equally important to optimal health and well-being. mental, physical, and social
What does by 'optimal means' mean?
'optimal' means: best possible compromise solution to a problem, when there are several competing considerations, not all of which can be simulataneously maximized.
What is the significance of variance analysis?
Patrik BAUER* The modern theory of capital structure was established by Modigliani and Miller (1958). Thirty-seven years later, Rajan and Zingales (1995, p. 1421) stated: "Theory has clearly made some progress on the subject. We now understand the most important departures from the Modigliani and Miller assumptions that make capital structure relevant to a firm's value. However, very little is known about the empirical relevance of the different theories." Similarly, Harris and Raviv (1991, p. 299) in their survey of capital structure theories claimed: "The models surveyed have identified a large number of potential determinants of capital structure. The empirical work so far has not, however, sorted out which of these are important in various contexts." Thus, several conditional theories of capital structure exist (none is universal), but very little is known about their empirical relevance. Moreover, the existing empirical evidence is based mainly on data from developed countries (G7 countries). Findings based on data from developing countries have not appeared until recently - for example Booth et al. (2001) 1 or Huang and Song (2002) 2 . So far, no study has been published based on data from transition countries of Central and Eastern Europe, at least to the extent of this author's knowledge. The main goal of this paper is to fill this gap, exploring the case of the Czech Republic. The structure of this paper is as follows. In Section 1 the most prominent theoretical and empirical findings are surveyed. In Section 2 the potential
