Capital structure optimization: a model of optimal capital structure from the aspect of capital cost and corporate value (CROSBI ID 317355)
Prilog u časopisu | izvorni znanstveni rad | međunarodna recenzija
Podaci o odgovornosti
Kontuš, Eleonora ; Šorić, Kristina ; Šarlija, Nataša
engleski
Capital structure optimization: a model of optimal capital structure from the aspect of capital cost and corporate value
The purpose of this study is, firstly, to examine capital structure optimization and secondly, to provide a framework for determining the optimal capital structure from the aspect of capital cost and corporate value. The results of our work provide an innovative model for arriving at a company’s optimal capital structure based on the estimation of the effective cost of capital and the determination of the shares of new equity and long-term debt that will both minimize the overall cost of capital and maximize its value. The model can be applied for quantitative estimates of optimal capital structure. This paper contributes to the literature by applying mathematical modeling and mathematical theory of optimization to solve the problem of capital structure optimization, and by providing a framework for determining optimal capital structure. The scientific contribution of this research is development of a model of optimal capital structure from the aspect of capital cost and corporate value, and new equations for calculating the effective costs of long-term financing sources. This model provides explicit advice on optimal long-term debt and equity level and can be applied to produce a firm-specific recommendation about optimal capital structure that a given company should use.
: The effective cost of capitaloptimal capital structurethe overall cost of capitalcorporate valuea model of optimal capital structure
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Podaci o izdanju
xx (xx)
2022.
1-20
objavljeno
1331-677X
1848-9664
10.1080/1331677X.2022.2147565