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linyuki linyuki
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A month ago
According to the static trade-off model of capital structure, in a world with taxes, firms have an incentive

▸ to issue less debt to reduce the costs of financial distress.

▸ to issue debt as this will always reduce the weighted average cost of capital.

▸ to issue debt until the benefits from the tax savings equals the costs of financial distress.

▸ to maximize the amount of debt.
Textbook 
Corporate Finance

Corporate Finance


Edition: 5th
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fassfass
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A month ago
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linyuki Author
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A month ago
Good timing, thanks!
Marcie D
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Yesterday
Smart ... Thanks!
jayfo05
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2 hours ago
Correct Slight Smile TY
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