Analytical Solution for Optimal Capital Structure in Perpetuities

We derive and present the formula for optimal debt under the assumption that tax shields are discounted at the cost of levered equity, Ke and cash flows are on perpetuity. The formulation is consistent and is derived from basic financial principles. This formulation is valid for non-growing perpetuities

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Year of publication:	2011
Authors:	Tham, Joseph
Other Persons:	Velez-Pareja, Ignacio (contributor) ; Kolari, James W. (contributor)
Publisher:	[2011]: [S.l.] : SSRN
Subject:	Theorie \| Theory \| Kapitalstruktur \| Capital structure \| Optimale Besteuerung \| Optimal taxation

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Extent:	1 Online-Ressource (7 p)
Type of publication:	Book / Working Paper
Language:	English
Notes:	Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments December 14, 2010 erstellt
Other identifiers:	10.2139/ssrn.1725527 [DOI]
Classification:	M21 - Business Economics ; M40 - Accounting and Auditing. General ; m46 ; M41 - Accounting ; G12 - Asset Pricing ; G31 - Capital Budgeting; Investment Policy ; J33 - Compensation Packages; Payment Methods
Source:	ECONIS - Online Catalogue of the ZBW

Persistent link: https://www.econbiz.de/10013132251