financial leverage in the investment decision-making effective use of inquiry（财务杠杆的投资决策的有效使用调查）.docVIP

Financial leverage in the investment decision-making effective use of inquiry Abstract: In the modern capital structure theory are reviewed on the basis that financial leverage will have economic theory and practice of combining our ideas, then the Daewoo Group made an example of the use of financial leverage financial leverage in the investment decision should be how to play role in the final conclusions. Keywords: financial leverage, capital structure, investment decisions Financial leverage can be as financing leverage, capital leverage, or debt, it is the investors in the development of capital structure decisions on the use of debt financing, which in this use, as long as companies in the debt financing by appropriate adjustment of capital structure additional revenue to the enterprise. the reality of financial leverage in the enterprise has an important role in business, if business investment rate of return greater than the debt interest rate, financial leverage will make capital gains as the absolute increase in debt management, which makes equity capital gains rate greater than the rate of corporate investment income, and higher debt-capital ratio, the greater the financial leverage, financial leverage, so the real interest rate is greater than the investment income as corporate debt interest, debt obtained by the conversion of some of the profits to the interests of capital, thus making the interest return on capital employed increased. Conversely, if business investment rate of return equal to or less than the debt interest rate, then the debt can only be generated profits are insufficient to cover debt or the interest required, or even the use of equity capital of the profits derived are insufficient to cover interest, and had to reduce the equity capital to debt, this is the essence of the loss of financial leverage. Directly affects the choice of financial leverage to the company’s capital structure and thus the rise and fall of an en