A Theory of the Firm's Cost of Capital: How Debt Affects the Firm's Risk, Value, Tax Rate, and The Government's Tax Claim by Ramesh K. S. Rao, Eric C. Stevens
English | 2007-03-12 | ISBN: 9812569499 | 106 pages | PDF | 0,6 mb
The cost of capital concept has myriad applications in business decision-making. The standard methodology for deriving cost of capital estimates is based on the seminal Modigliani-Miller analyses. This book generalizes this framework to include non-debt tax shields (e.g., depreciation), interactions between the borrowing rate and tax shields, and default considerations.