| Author: | Dempsey, M. |
| Title: | The impact of personal taxes on the firms weighted average cost of capital and investment behaviour: A simplified approach using the Dempsey discounted dividends model |
| Journal: | Journal of Business Finance and Accounting
1998 : JUN/JUL, VOL. 25: 5-6, p. 747-763 |
| Index terms: | TAXATION COSTS CAPITAL INVESTMENTS MODELS |
| Language: | eng |
| Abstract: | In the paper, the discounted dividends model by Dempsey (1996) is extended to provide a weighted average cost of capital (or WACC) assessment of investment opportunities with irregular cash flows. Thereafter, a framework is extended to assessment of the implications of government tax policy for the firm's investment behaviour. The developed framework is consistent with empirical evidence of Poterba and Summers (1985). |
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