文档介绍：Part 4 Capital structure and Dividend policy
Outline of this part
If a firm seeks to create value with its financing decisions, the firm must find positive NPV financial arrangements.
We will show that the sources of NPV in financing are taxes, bankruptcy, and agency costs.
This part posed by six chapters like :
Chapter 13 Corporate financing decisions and efficient capital markets
Chapter 14 Long—term financing: an introduction
Chapter 15 Capital structure: basic concepts
Chapter 16 Capital structure: limits to the use of debt
Chapter 17 Valuation and capital budgeting for the levered firm
Chapter 18 Dividend policy: why does it matter?
Part 4 Capital structure and Dividend policy
Chapter 13 Corporate—financing decisions and ECM
Chapter 13 Corporate—financing decisions and ECM
In the past few parts, we have concentrated almost exclusively on the left—hand side of the balance sheet(the firm’s capital expenditure decisions), and now we move to the right—hand side and to the problems involved in financing the capital expenditures.
To put it crudely, you have learned hoe to spend money, now you must to learn how to raise it.
Now we have not totally ignored financing in our discussion of capital budgeting. But we made the simplest possible assumption: all—equity financing.
Chapter 13 Corporate—financing decisions and ECM
What should we do for determine the best financing strategy?
Should the firm reinvest most of its earnings in the business, or should it pay them out as dividends?
If the firm needs more capital, should it issue more stock or should it borrow?
Should it borrow short—term or long—term ?
Should it borrow by issuing a normal long—term bond or a convertible bond?
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Chapter 13 Corporate—financing decisions and ECM
Should financing decisions create value?
In the earlier parts of this book, we have learn how to evaluate project with NPV.
Typical financing decisions include how much, what type and when for the debt and equity to sell.
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