search query: @journal_id 56 / total: 1032
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| Author: | Bowman, R. |
| Title: | Information content of financial leverage: an empirical study: a comment |
| Journal: | Journal of Business Finance and Accounting
1995 : APR, VOL. 22:3, p. 455-460 |
| Index terms: | MANAGEMENT FINANCE INFORMATION |
| Language: | eng |
| Abstract: | Kim, Chen and Nance examine share price reaction to the announcement of security issuances. They test the appropriateness of four theories of the relationship between financial leverage and firm value: irrelevance, maximum debt, optimal financial leverage and bad news 9pecking order theory). However, the tests which they perform are invalid and their conclusions unwarranted. this comment describes the errors and discusses how valid tests might be conducted. |
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