The Best Capital Structure Model of Enterprises With Relative Unchangeable Due Capital Cost
Zhang Yun-kun
Abstract
Zhang Yun-kun
Abstract
At present,it is difficult to accurately display the financial lever,capital cost and Earnings Before Interest and Tax with any capital structure theories,which limits the role playing in finical decision of enterprises.In this paper,the functional relation is established among weighted average capital cost,Earnings Before Interest and Tax and due capital cost,and the best capital structure model of enterprises with relative unchangeable due capital cost is obtained.
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At present,it is difficult to accurately display the financial lever,capital cost and Earnings Before Interest and Tax with any capital structure theories,which limits the role playing in finical decision of enterprises.In this paper,the functional relation is established among weighted average capital cost,Earnings Before Interest and Tax and due capital cost,and the best capital structure model of enterprises with relative unchangeable due capital cost is obtained.
Key concepts: Cost of capital, Capital (architecture), Weighted average cost of capital, Earnings, Marginal cost of capital schedule, Business, Capital structure, Capital intensity