Hostname: page-component-78c5997874-t5tsf Total loading time: 0 Render date: 2024-11-15T10:18:22.521Z Has data issue: false hasContentIssue false
  • English
  • Français

Asset Selection with Changing Capital Structure

Published online by Cambridge University Press:  19 October 2009

Edwin J. Elton  and
Martin J. Gruber
Get access Rights & Permissions [Opens in a new window]

Extract

One of the major problems in finance is that of combining the separate costs of debt and equity into an appropriate cutoff rate for new investment; this problem is particularly acute when the firm is changing its capital structure. Solutions to this problem which have been proposed include various types of both marginal costing and average costing.

Type
Research Article
Information
Journal of Financial and Quantitative Analysis , Volume 8 , Issue 3 , June 1973 , pp. 459 - 474
Copyright
Copyright © School of Business Administration, University of Washington 1973

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

[1]Archer, Stephen, and D'Ambrosio, Charles. Business Finance: Theory and Management. New York: Macmillan, 1966.Google Scholar
[2]Duesenberry, James S.Business Cycles and Economic Growth. New York: McGraw-Hill, 1958, Chapter 5.Google Scholar
[3]Durand, David. “The Cost of Debt and Equity Funds for Business.” In Soloman, Ezra, ed. The Management of Corporate Capital. Glencoe, Ill.: Free Press, 1959, pp. 91–127.Google Scholar
[4]Elton, Edwin J., and Gruber, Martin J.. “The Effect of Share Repurchase on the Value of the Firm.” Journal of Finance, vol. 23 (March 1968), pp. 135–149.Google Scholar
[5]Elton, Edwin J. “The Cost of Retained Earnings — Implications of Security Repurchase.” Industrial Management Review, vol. 9 (Spring 1968), pp. 87–104.Google Scholar
[6]Elton, Edwin J. “Marginal Stockholder Tax Brackets and the Clientel Effect.” Review of Economics and Statistics, February 1970, pp. 68–74.CrossRefGoogle Scholar
[7]Friedland, Seymour. The Economics of Corporate Finance. Englewood Cliffs, N. J.: Prentice-Hall, 1966.Google Scholar
[8]Johnson, Robert. Financial Management, 3rd ed.Boston: Allyn and Bacon, 1966.Google Scholar
[9]Kuh, E. D.Capital Stock Growth: A Micro-Economic Approach. Amsterdam: North-Holland, 1963, Chapter 2.Google Scholar
[10]Lindsay, Robert, and Sametz, Arnold. Financial Management: An Analytical Approach. Homewood, Ill.: R. D. Irwin, 1963.Google Scholar
[11]Modigliani, Franco, and Miller, Merton. “The Cost of Capital, Corporation Finance, and the Theory of Investment.” American Economic Review, vol. 48 (June 1958), pp. 261–297.Google Scholar
[12]Modigliani, Franco. “Corporate Income Taxes and the Cost of Capital: A Correction.” American Economic Review, vol. 53 (June 1963), pp. 422–433.Google Scholar
[13]Solomon, Ezra. The Theory of Financial Management. New York: Columbia University Press, 1963.Google Scholar
[14]Weston, Fred, and Brigham, Eugene. Managerial Finance, 2nd ed. New York: Holt, Rinehart and Winston, 1966.Google Scholar