University of Illinois at Urbana-Champaign
Two Essays on Investment and Financing Decisions of Firms
Abstract
dc:descriptionEssay I examines the intertemporal interdependencies among investment, financing, and dividend decisions of a present-value maximizing firm. The approach taken is that of control theory. The model provides useful insight into optimum firm behavior over time. The results show that investment and financing decisions are jointly determined for a value maximizing firm. This is an argument against the separation principle. The second important result is that dividend policy does generally affect the maximizing firm's value. This result invalidates the residual theory of dividends. The model prescribes an optimal investment-financing plan, the long-run equity and debt demand for the firm, and the long-run behavior of investment and financing as they are affected by the existence of adjustment costs.
Degree
thesis:*- Name thesis:degree_name
- Ph.D.
- Level thesis:degree_level
- Dissertation
- Discipline thesis:degree_discipline
- Finance
- Grantor
- University of Illinois at Urbana-Champaign
- Year dc:date
- 2014
Author and committee
dc:creator, dc:contributor.*- Author dc:creator
-
- Rahman, Shafiqur
Subjects
dc:subject × 1Identifiers
dc:identifier.*- Identifier
- (UMI)AAI8701595
- OAI identifier oai:identifier
- oai:www.ideals.illinois.edu:2142/71523