Financial Leverage and the Cost of Capital
Description:
The objective of the research reported in this dissertation is to conduct an empirical test of the hypothesis that, excluding income tax effects, the cost of capital to a firm is independent of the degree of financial leverage employed by the firm. This hypothesis, set forth by Franco Modigliani and Merton Miller in 1958, represents a challenge to the traditional view on the subject, a challenge which carries implications of considerable importance in the field of finance. The challenge has led…
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Date:
December 1977
Creator:
Brust, Melvin F.
Partner:
UNT Libraries