--%>
Assignment Help - homework help

Common factors influencing capital structure

Write down the common factors influencing capital structure?

E

Expert

Verified

The common factors which are influencing the capital structure are illustrated below :-

1) Company constitution : In companies capital structure is extremely significant as many companies treat it as a dissimilar entity. Private companies considers control factor as significant whereas public company finds cost factor more significant.

2) Company characteristics : Characteristic of the company that explain its infrastructure as age, size and credit plays pivotal role in deciding the capital structure. Slighter or newly started companies depend more on equity capital as they can do limited bargaining. Large companies or having good credit companies are in the place to get funds from the source of their selection.

3) Stability of Earnings : Fluctuations takes place if the earnings and sales of the company are not secure enough over an era of time. Stable company can get the risk.

4) Attitude of the Management : Attitude performs a significant role as if the attitude is conventional then control factor gets the significance and if it is liberal then cost factor gets significant.

   Related Questions in Business Economics

  • Q : Problem regarding supplies-demands and

    The new supply and demand curves within University City are S0 and D0. But after the county commission imposed a $3 per six-pack excise tax upon beer: (1) demand fell to D1 from the perspectives of beer dealers. (2) co

    		•
  • Q : Contrast a vertically integrated firm

    Contrast a vertically integrated firm, a horizontally integrated firm, and a conglomerate?

    		•
  • Q : Real exchange rate Question: To

    Question: To determine the real exchange rate, what two pieces of information do you need in addition to the nominal exchange rate? Answer:

    Q : Reducing output of other good When the

    When the production possibilities frontier in a proficient economy is not growing, raising the output of one good always needs: (i) Increasing the output price for the other good. (ii) Bigger amounts of resources. (iii) Decreasing the output of other

    		•
  • Q : Garfield’s utility function Problem 2

    Problem 2 Consider Garfield's utility function given as U(x1, x2) = x1x2, wher

    		•
  • Q : Economic crisis situation in Europe

    Question: Describe the present economic crisis situation in Europe.   Why has it been so difficult for the Europeans to find a solution to this problem?   Comment on what implications the crisis may have for the rest of the world i

    		•
  • Q : Example of self interest to define

    The concept of _____ was demonstrated by _____ along with the quotation, “The defeat of a bit finger would remain the average European from sleeping which night,... but, given he never saw them, he will snore along with the most profound security over the loss o

    		•
  • Q : Competitive market economy will make

    Briefly explain how the competitive market economy will make the needed adjustments to reestablish an efficient allocation of society’s scarce resources?

    		•
  • Q : Explain about the arbitrage except

    Not like speculation, there arbitrage is: (w) an activity which is generally more lucrative when conditions are favorable. (x) a profitable and relatively riskless activity. (y) the process of representing a domestic company within fo

    		•
  • Q : Utility with food coupons Question: In

    Question: In Vancouver the Salvation Army encourages people to make food voucher donations to panhandlers instead of simply giving them cash. You can buy a food voucher for $5 and give it to a panhandler who can use it to purchase food. The Sa

    		•