Economics, Econometrics and Finance
3 years ago

Company Value Soars with Increased Debt, But Beware the Breaking Point

1 view
EMC Review - Časopis za ekonomiju - APEIRON
THE INFLUENCE OF THE FINANCIAL STRUCTURE OF CAPITAL ON THE ESTIMATED VALUE OF THE COMPANY
Elvis Mujkić

Paper Summary

The study looked at how a company's financial structure affects its value. They used methods like discounting cash flow and comparing with similar transactions. The results showed that as a company takes on more debt, its value can increase up to a point. After that point, too much debt can actually decrease the company's value.

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