A firm’s mix of different securities is known as its capital structure. A firm’s capital structure has many implications on its overall profitability, riskiness, and sustainability.
The capital structure and the leverage ratios of public companies can be found by utilizing Web sites such as Gurufocus.com, Yahoo Finance, and MSN Money. Write a minimum 5-page assessment of the capital structure and leverage ratios of 2 firms, and include the following in your assessment:
Describe the optimal capital structure theorem and its limitations.
Locate the current capital structure and the leverage ratios of 2 firms.
Examine the capital structure of the 2 firms.
Explain how the capital structure affects the cost of capital of the 2 firms and their profits, and provide mathematical examples of different scenarios.
Explain how the leverage of the 2 firms can affect the riskiness, profitability, and sustainability of the business.
Submitting your assignment in APA format means, at a minimum, you will need the following:
Title page: Remember the running head. The title should be in all capitals.
Length: 5 pages minimum
Abstract: This is a summary of your paper, not an introduction. Begin writing in third person.
Body: This begins on the page following the title page and abstract page and must be double-spaced (be careful not to triple- or quadruple-space between paragraphs). The typeface should be 12-pt. Times Roman or 12-pt. Courier in regular black type. Do not use color, bold type, or italics, except as required for APA-level headings and references. The deliverable length of the body of your paper for this assignment is 5 pages. In-body academic citations to support your decisions and analysis are required. A variety of academic sources is encouraged.
Reference page: References that align with your in-body academic sources are listed on the final page of your paper. The references must be in APA format using appropriate spacing, hanging indent, italics, and uppercase and lowercase usage as appropriate for the type of resource used. Remember, the Reference page is not a bibliography but a further listing of the abbreviated in-body citations used in the paper. Every referenced item must have a corresponding in-body citation.
Please submit your assignment.
