Download or read book The Influence of Market Structure on the Cost of Capital written by John Robert Stodden and published by . This book was released on 1970 with total page 116 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Does capital structure influence firms value written by Ulrike Messbacher and published by GRIN Verlag. This book was released on 2005-12-20 with total page 12 pages. Available in PDF, EPUB and Kindle. Book excerpt: Essay from the year 2004 in the subject Business economics - Investment and Finance, grade: 1, University of Applied Sciences Kempten (University of Ulster), language: English, abstract: In accordance with the Signalling model by Ross (1977) an increase in gearing represents, in term of a company’s prospective cash flows, a positive signal to external investors. Because, due to the higher risk of financial distress, companies with less optimistic market prospective tend to avoid additional financial obligations. This implies that an increasing indebtedness means a higher quality of business and therefore better valuation. This leads, in turn, to the assumption that the corporate management can influence a firm’s value by changing its capital structure. If capital structure can affect value, how can firms identify an optimal capital structure and what will it look like? It is that mix of debt and equity that maximises the value of a firm and, at the same time, minimise overall cost of capital. In their seminal article, published in 1958 and 1963, Modigliani and Miller argue that under certain assumptions the value of a firm i s independent of its capital structure, but with tax-deductible interest payments, they are positively related. Moreover, there are other approaches with partly contradictory perceptions. For instance, Myers (1998, cited in Fairchild 2003, p.6) argues that there is no universal optimal mix of debt and equity; in fact it depends on firms or industries, and therefore should be considered on a case-by-case basis. Other researchers have added market imperfections, such as bankruptcy costs, agency costs, and gains from leverage- induced tax shields to the analysis and have maintained that an optimal capital structure may exist (Hatfieldet al.1994, p.1). First, this paper shows the basic determinants of a firm’s value in association with the impact of financial leverage on payoffs to stockholders. Secondly, it considers some arguments of capital structure theories, particularly the Modigliani and Miller theorem and the Traditional approach and contrasts them. Finally, the underlying factors of the model assumptions are examined and shown that they are important in the choice of a firm’s debt-equity ratio.
Download or read book The Effect Of Capital Structure On The Cost Of Capital written by Alexander Barges and published by . This book was released on 2012-04 with total page 136 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Market Structure and the Cost of Capital written by Mohamed El Hedi Arouri and published by . This book was released on 2013 with total page 25 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book The Cost of Capital written by Cleveland S. Patterson and published by Bloomsbury Publishing USA. This book was released on 1995-04-30 with total page 342 pages. Available in PDF, EPUB and Kindle. Book excerpt: Knowledge about the magnitude of the cost of capital invested in an asset and its determinants is essential for the analysis of corporate investment decisions and for assessing profitability. This book provides a clear conceptual understanding of the cost of capital, the characteristics of an asset that influence it, and a critical, comprehensive, and up-to-date evaluation of practical means for estimating its magnitude. It is intended primarily for use by professional managers, but will also be valuable to future managers in advanced capital budgeting courses. The focus of the discussion is on estimation methods that are theoretically sound and consistent with a corporate goal of value creation. Three methods are analyzed in depth: the discounted cash flow model, the capital asset pricing model, and arbitrage pricing theory. For each method, the basic theory is set out in a nontechnical manner and empirical evidence in support of the model is critically reviewed. The bulk of the discussion then focuses on practical means for implementing the methods for decision-making purposes. Later chapters focus on the effects of the debt-supporting characteristics of assets, on the valuation of options embedded in securities, and on the estimation of the cost of capital for evaluating international investments. The final chapter discusses certain aspects of the use of cost of capital in public utility regulation. Care is taken to separate out key issues from more peripheral material through a comprehensive set of supplementary notes.
Download or read book Equity Trading Round Up written by Robert A. Schwartz and published by Springer Nature. This book was released on 2020-11-16 with total page 173 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book examines the complexity of trading and the creation of liquidity. Titled after the Baruch College Financial Markets Conference, Equity Market Round-Up: Proposals for Strengthening the Markets, this book explores how regulation has a clear impact on market structure and, therefore, how market structure impacts efficient trading and capital formation. The following questions are analyzed: What are the liquidity strategies for pricing and interacting? Is liquidity any more available today for an illiquid stock than it was on the floor of the exchange 20 years ago? How do we cope with the dynamics of a continuous market? How can market structure be improved? What are the effects of high frequency trading? The Zicklin School of Business Financial Markets Series presents the insights emerging from a sequence of conferences hosted by the Zicklin School at Baruch College for industry professionals, regulators, and scholars. The transcripts from the conferences are edited for clarity, perspective and context; material and comments from subsequent interviews with the panelists and speakers are included for a complete thematic presentation. Each book is focused on a well delineated topic, but all deliver broad insights into the quality and efficiency of the U.S. equity markets and the dynamic forces that are changing them.
Download or read book Market Structure and Technological Change written by W. Baldwin and published by Taylor & Francis. This book was released on 2013-06-17 with total page 192 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book provides a survey of the theory and of the empirical knowledge about the links between market structure and technological change.
Download or read book Investment Market Structure and the Cost of Capital written by Varouj A. Aivazian and published by . This book was released on 1977 with total page 28 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Market Structure and Performance written by J. Cubbin and published by Taylor & Francis. This book was released on 2013-10-15 with total page 90 pages. Available in PDF, EPUB and Kindle. Book excerpt: First Published in 2001. Routledge is an imprint of Taylor & Francis, an informa company.
Download or read book Inefficient Markets written by Andrei Shleifer and published by OUP Oxford. This book was released on 2000-03-09 with total page 295 pages. Available in PDF, EPUB and Kindle. Book excerpt: The efficient markets hypothesis has been the central proposition in finance for nearly thirty years. It states that securities prices in financial markets must equal fundamental values, either because all investors are rational or because arbitrage eliminates pricing anomalies. This book describes an alternative approach to the study of financial markets: behavioral finance. This approach starts with an observation that the assumptions of investor rationality and perfect arbitrage are overwhelmingly contradicted by both psychological and institutional evidence. In actual financial markets, less than fully rational investors trade against arbitrageurs whose resources are limited by risk aversion, short horizons, and agency problems. The book presents and empirically evaluates models of such inefficient markets. Behavioral finance models both explain the available financial data better than does the efficient markets hypothesis and generate new empirical predictions. These models can account for such anomalies as the superior performance of value stocks, the closed end fund puzzle, the high returns on stocks included in market indices, the persistence of stock price bubbles, and even the collapse of several well-known hedge funds in 1998. By summarizing and expanding the research in behavioral finance, the book builds a new theoretical and empirical foundation for the economic analysis of real-world markets.
Download or read book The Impact of Market Structure and Asset Size on the Financial Structure of U S Manufacturing Industries 1949 1982 written by Nindy Paul Sandhu and published by . This book was released on 1986 with total page 682 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book The Effects of Complex Capital Structure on the Market Values of Firms written by Thomas J. Frecka and published by . This book was released on 1979 with total page 66 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book The Influence of Capital Structure on Company Value with Different Growth Opportunities written by Kevin Chen and published by . This book was released on 2002 with total page 14 pages. Available in PDF, EPUB and Kindle. Book excerpt: In this paper, we will try to empirically test the influence of the debt structure on the company value given different growth opportunities with the companies incorporated in Netherlands. It is well accepted that the market value of any firm is independent of its capital structure, given the assumptions of capital markets are quot;perfectquot;. It is observed that the optimal capital structures are closely related to the growth potential of the firms and some other variables, such as: the size and the industry characteristics. Building on the argument that high-growth firms corporate value is negatively correlated with leverage, whereas for quot;low-growthquot; firms corporate value is positively correlated with leverage, we should observe that the growth opportunities may influence the optimal capital structure. The reason is that the optimal leverage may shift with the changes of growth opportunities that lead to the changes of agency costs of debt and cost of managerial discretion. In this context, we will try to empirically test 1: The correlation between Tobin's Q and leverage will be positive given the differences in growth opportunities; and 2: The correlation between Tobin's Q and leverage will be negative for high-growth firms and positive for low-growth firms. We expect that the signalling function of the debt will overweight the influence of the growth opportunities on the debt structure if hypothesis one is proved. Otherwise, the influence of the growth opportunities on the shift of the agency cost of debt and agency cost of managerial discretion will dominate the model. Finally, the influence of zero-debt capital structure is tested and discussed.
Download or read book Market Structure and the Nature of Price Rigidity written by David Neumark and published by . This book was released on 1989 with total page 56 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Business Behavior written by William J. Baumol and published by . This book was released on 1967 with total page 188 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Regulatory Risk and the Cost of Capital written by Burkhard Pedell and published by Springer Science & Business Media. This book was released on 2006-04-20 with total page 226 pages. Available in PDF, EPUB and Kindle. Book excerpt: Austrian Controller Award 2005 This book develops a comprehensive concept of regulatory risk integrating existing theoretical and empirical research. The focus is on explaining how the design of the regulatory system influences the risk of a rate-regulated firm, as well as on elaborating appropriate methods for the determination of the regulatory rate base and the allowed rate of return. Regarding the regulatory rate base, the question of whether market value of capital or book value of assets should be employed and the choice of the depreciation scheme are at the center of the discussion. Specific methodical issues concerning cost of capital assessment for rate-regulated firms are analyzed, i.e. the circularity of rate regulation, the sharing of risks between capital owners and rate payers, the length of the regulatory review period, the regulation of the capital structure as well as the conversion of a post-tax to pre-tax weighted average cost of capital.
Download or read book Market Structure written by Fouad Sabry and published by One Billion Knowledgeable. This book was released on 2024-01-24 with total page 336 pages. Available in PDF, EPUB and Kindle. Book excerpt: What is Market Structure According to the field of economics, market structure is a representation of how businesses are distinguished and classified according to the kinds of products they offer (homogeneous or heterogeneous) and how their operations are influenced by elements and influences from the outside world. When compared to other markets, market structure makes it much simpler to comprehend the peculiarities of various markets. How you will benefit (I) Insights, and validations about the following topics: Chapter 1: Market structure Chapter 2: Microeconomics Chapter 3: Monopoly Chapter 4: Monopolistic competition Chapter 5: Oligopoly Chapter 6: Perfect competition Chapter 7: Imperfect competition Chapter 8: Industrial organization Chapter 9: Barriers to entry Chapter 10: Monopoly profit Chapter 11: Contestable market Chapter 12: Market power Chapter 13: Market concentration Chapter 14: Market (economics) Chapter 15: Competition (economics) Chapter 16: Edward Chamberlin Chapter 17: Bilateral monopoly Chapter 18: Market distortion Chapter 19: Chamberlinian monopolistic competition Chapter 20: Profit (economics) Chapter 21: Monopsony (II) Answering the public top questions about market structure. (III) Real world examples for the usage of market structure in many fields. Who this book is for Professionals, undergraduate and graduate students, enthusiasts, hobbyists, and those who want to go beyond basic knowledge or information for any kind of Market Structure.
