资料简介: The value of the firm can be thought of as a pie. The goal of the manager is to increase the size of the pie The Capital Structure decision can be viewed as how best to slice up a the pie. If how you slice the pie affects the size of the pie, then the capital structure decision matters Primary Market When a corporation issues securities, cash flows from investors to the firm. Usually an underwriter is involved Secondary Markets Involve the sale of “used” securities from one investor to another. Securities may be exchange traded or trade over-the-counter in a dealer market. The basic feature of a debt is that it is a promise by the borrowing firm to repay a fixed dollar amount of by a certain date. The shareholder’s claim on firm value is the residual amount that remains after the debtholders are paid. If the value of the firm is less than the amount promised to the debtholders, the shareholders get nothing.