Capital Structure

Objective

• Calculate the impact of capital structure changes on firm value

Reading

• Chapter 17: Capital Structure in a Perfect Market
• Chapter 18: Taxes and Capital Structure
• Chapter 19: More Imperfect-Market Capital Structure

Assignment

• Capital Structure Project

Capital Structure Overview

Modigliani and Miller

Optimal Financing

The Trade-Off by Aswath Damodaran @ NYU in 2014

The Cost of Capital by Aswath Damodaran @ NYU in 2014

Moving to the Optimal Financing Mix by Aswath Damodaran @ NYU in 2014

Homemade Leverage

Homemade Leverage Example (Part 1) (Part 2) (Part 3) by Patrick @ Ryerson University

Optional Topics

Leveraged Buyout

Marketplace @ APM