Nobody downloaded yet

Capital Structure Pre and Post Global Financial Crisis - Dissertation Example

Comments (1) Cite this document
Summary
The capital structure of a company represents the mix of the different sources of capital that the company makes use of for financing the activities of the company targeted towards achievement of its goals and objectives…
Download full paperFile format: .doc, available for editing
GRAB THE BEST PAPER93.3% of users find it useful
Capital Structure Pre and Post Global Financial Crisis
Read TextPreview

Extract of sample
"Capital Structure Pre and Post Global Financial Crisis"

Download file to see previous pages When debt financing is concerned, it includes borrowing from the banks, financial leasing, and bond issuing in the bond market. Equity financing mainly constitutes the retained earnings and issuing of additional shares in the stock market. Capital structure has its own importance in a company. There are primary two reasons supporting this fact. Firstly, debt and equity having differences in the costs, in the interest rates, and the required rates of return, there arises a need have an appropriate combination of debt and equity that can maximize the value of the firm by reducing the total cost of the company. This is achievable through the capital structure of the company (Broyles, 2003, pp.303-304). Secondly the knowledge and understanding of capital structure proves important since the borrowing of capital has an influence on the financial risk of the firm. The volatility of the net income or earnings per share of a company increases with the interest payments that represent additional fixed expenses for the company. This in turn increases the payment of interests on the issuing of bonds. The cost of equity capital also increases in the stock market as a result of borrowing. All these factors might eventually lead a company to financial distress or risk that leads to the increasing need for an appropriate capital structure (Broyles, 2003, p.304). ...
primary aim of the study is to evaluate the capital structure of firms in the UK before the global economic crisis in the years around 2007 and after the financial crisis in the years 2011 or 2012. In order to achieve the above mentioned aim of the study, the following objectives have been considered: Review theories on capital structure in order to determine how it might change during a period of prolonged recession and liquidity crisis. Compare and contrast the capital structure of public UK companies in 2007 and in 2011/2012. Evaluate the extent to which any changes in capital structure are due to the ongoing global crisis. Capital Structure: An Understanding towards the Effect of Economic Crisis: There are four basic theories related to capital structure of a firm. These are: Net Income Theory of Capital Structure: This theory stresses on a firm’s ability to choose a capital structure where the level of share capital or equity is less than the debt of the firm. This helps a firm to increase its market value and thus decrease the weighted average cost of capital of the company. If the content of the debt in the capital structure mix is high, it is referred as financial leverage increasing which increases the value of the firm (Theories of Capital Structure, 2010). Thus it can be understood that when there is an economic crisis prevailing in a country, the availability of the debt reduces that affects the ration of the debt to equity and hence the capital structure of a firm would alter as a result. Net Operating income Theory of Capital Structure: According to this theory, the concept of increasing financial leverage does not exist. It believes that changing the capital structure of a firm does not bring any change in the overall financial cost and value of the ...Download file to see next pagesRead More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“Capital Structure Pre and Post Global Financial Crisis Dissertation”, n.d.)
Retrieved from https://studentshare.org/business/1399161-business
(Capital Structure Pre and Post Global Financial Crisis Dissertation)
https://studentshare.org/business/1399161-business.
“Capital Structure Pre and Post Global Financial Crisis Dissertation”, n.d. https://studentshare.org/business/1399161-business.
  • Cited: 0 times
Comments (1)
Click to create a comment or rate a document
ag
agulgowski added comment 1 month ago
Student rated this paper as
Great paper! Used it to finish an assignment for a business course. It was easy as ABC, for the first time in my life.
CHECK THESE SAMPLES - THEY ALSO FIT YOUR TOPIC
Why the Islamic Financial System has the Strength to Mitigate the Current Financial Crisis
Why the Islamic Financial System has the Strength to Mitigate the Current Financial Crisis? The research study is an analytical approach towards evaluation of the Islamic financial system for measuring its effectiveness to mitigate the present financial crisis in the world.
63 Pages(15750 words)Dissertation
The Impact of the Global Economic Crisis on Organisations in Oil-Producing Countries: A Case Study of SABIC
A comparison will then be made to ascertain the reasons for variations in any of results obtained as the price of crude oil varies. Analysis of liquidity, solvency, asset anagement and leveraging results will form part of this process.The research will provide undisputable evidence to support the proposed hypothesis.
53 Pages(13250 words)Dissertation
The Global Financial Crisis: Impact on Property Markets in the UK
The aim of this study is to investigate the impact of the global financial crisis on the UK property market. This will involve seeking data that will reveal the direct financial impacts of the crisis on the property companies, the impact on property consumers in terms of confidence and patterns, the strategic management adaptations to the crisis and the impacts of such responses.
46 Pages(11500 words)Dissertation
Impact Of Financial Crisis On The Capital Structure Decision Making Of The Firm
Capital structure theories have developed framework for defining aspects and patterns of capital structure as well as response to changing dynamics and hence, owing to the financial crisis and distressed period the capital structure of the firm have also shown responses.
12 Pages(3000 words)Essay
Determinants of Capital Structure of Listed Saudi Arabian Companies
The capital structure of a firm is the relative proportion of borrowed capital in comparison to equity capital. The importance of investigating the implications of the level of debt in the financing of a firm’s operation is of importance because it has direct impact on the cost of capital of the company and therefore on the company’s bottom line.
50 Pages(12500 words)Dissertation
Post-Crisis Ship Finance: A Greek Perspective: How the ship financing scene is changing for Greek new comers in the shipping i
Shipping markets are segmented into domestic, coastal and regional segments. Along with transporting passengers; shipping cargoes is also a profitable business. Business world believes shipping is the core system of maritime industry, but ports are also a major issue to look around.
38 Pages(9500 words)Dissertation
Two part paper about the recent financial crisis and Hyman Minsky's theories
est Rates 28 2.7 Financial Stability and Monetary Policy 28 2.8 Minsky’s Theory on Financial Crises 29 Chapter 3 - Model Outline 34 3.1 Greenspan’s Articulation 34 3.2 Taylor’s Articulation 41 3.3.Time Series Properties and Co Integration Issues 45 Before proceeding to the estimation, the time series properties of the dependent and independent variables are checked out.
20 Pages(5000 words)Dissertation
Capital Structure of Public Limited Companies
Theories of capital structure and also empirical studies on that have been analyzed trough out the paper to assess the reasons behind change in capital structure. This paper provides a clear understanding of the influence of financial crisis on corporate finance which leads to change in capital structure based on the financial environment of the market.
4 Pages(1000 words)Dissertation
Undertake a review of the current literature to identify the key determinants of capital structure since the global financial crisis
It reveals the magnitude, nature along with the distribution on the basis of which financial funds are allocated in a particular organisation. The notion of capital structure signifies the assets and the liabilities of an organisation. In this regard, every organisation possesses a capital structure in accordance with which income along with expenses is determined.
5 Pages(1250 words)Literature review
Mutual Funds Pre and Post Global Financial Crisis: A Perspective on the impact on performance
anager who makes investments using the fund’s capital in an attempt to produce capital gains and income, and in a manner consistent to the investment objectives stated within the fund’s prospectus. In exchange for the benefits of mutual funds, investors implicitly accept
30 Pages(7500 words)Essay
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Let us find you another Dissertation on topic Capital Structure Pre and Post Global Financial Crisis for FREE!
Contact us:
+16312120006
Contact Us Now
FREE Mobile Apps:
  • About StudentShare
  • Testimonials
  • FAQ
  • Blog
  • Free Essays
  • New Essays
  • Essays
  • Miscellaneous
  • The Newest Essay Topics
  • Index samples by all dates
Join us:
Contact Us