Search Results - subject:"constant leverage"

CONSTANT LEVERAGE AND CONSTANT COST OF CAPITAL: A COMMON KNOWLEDGE HALF-TRUTH

VÉLEZ-PAREJA, IGNACIO; IBRAGIMOV, RAUF; THAM, JOSEPH - In: ESTUDIOS GERENCIALES (2008)

A typical approach for valuing finite cash flows is to assume that leverage is constant (usually as target leverage) and the cost of equity, Ke and the Weighted Average Cost of Capital, WACC are also assumed to be constant. For cash flows in perpetuity, and with the cost of debt, Kd as the...

Persistent link: https://www.econbiz.de/10005604170

Constant leverage and constant cost of capital: a common knowledge half-truth

Velez-Pareja, Ignacio; Ibragimov, Rauf; Tham, Joseph - MASTER CONSULTORES - 2007

under the constant leverage financing policy. As could be seen from the findings and example of Inselbag and Kaufold (1997 …

Persistent link: https://www.econbiz.de/10010762929

Valuation of cash flows with constant leverage: Further insights

Velez-Pareja, Ignacio; Tham, Joseph - MASTER CONSULTORES - 2007

flows that are consistent with constant leverage. We verify the consistency of the example with two basic principles … constant leverage when some restrictive conditions are not satisfied. …

Persistent link: https://www.econbiz.de/10010763044