Financial Leverage is Influenced by Tax Deductibility


 
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Financial Leverage is Influenced by Tax Deductibility
Olawale Christopher Olamiju, Financial Consultant, Nigeria, Member
It is true that financial leverage could be used to magnify the rate of return on shareholders' equity as a result of the tax deductibility of interest payments.
The beauty of the extent to which financial leverage can be used in this perspective is better appreciated going by the various propositions of Modigiliani and Miller as well as the Trade Off theory....Sign up
 

 
Influence of Modigliani–Miller Theorem on Financial Leverage
Jaap de Jonge, CEO, Netherlands, Editor
Hi Olawe, interesting.
Wikipedia says the Modigliani–Miller theorem is the basis for modern thinking on capital structure. The basic theorem stat...Sign up
 

 
Tax Shield is a Determinant to Determine the Leverage
ling, Student (MBA), Germany, Member
@Jaap de Jonge (Editor): Modigiliani and Miller theory is under friction conditions: this means that only in:
- ...Sign up
 

 
Influence of Modigiliani and Miller on Financial Leverage
Olawale Christopher Olamiju, Financial Consultant, Nigeria, Member
@Jaap de Jonge (Editor) : the definition in Wikipedia is proposition 1 of the Modigiliani and Miller theorem, which i...Sign up
 

 
 


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