mileston payments can be used to help overcome the lemons problem

mileston payments can be used to help overcome direct bankruptcy costs

when firms issue equity to finance projects, this tends to send a negative signal to investors

when firms issue equity to finance projects, this tends to send a positive signal to investors

firms with more tangible capital tend to rely more on debt financing, all else equal

firms with more tangible capital tend to rely less on debt financing, all else equal

financial slack is more valuable for high-growth vs. low-growth firms, all else equal

financial slack is more valuable for low-growth vs. high-growth firms, all else equal

when firms repurchase shares, this tends to send a positive signal to investors

when firms repurchase shares, this tends to send a negative signal to investors

firms with stable cash flows tend to be good candidates for leveraged buyouts

firms with volatile cash flows tend to be good candidates for leveraged buyouts

Miller-Modigliani says that, in a perfect market, firm value is unaffected by the choice of debt vs. equity

Miller-Modigliani says that, in a perfect market, debt financing is better than equity financing

tradeoff theory says that firms should balance positive value of interest tax shields with the negative value of financial distress costs

pecking order theory says that firms should balance positive value of interest tax shields with the negative value of financial distress costs

pecking order theory says that firms should prefer internal cash or debt financing to equity financing for new projects

tradeoff theory says that firms should prefer internal cash or debt financing to equity financing for new projects

the high first-day abnormal returns of IPO firms largely reflects a type of selection bias where underwriter partners commit to buying more shares of unsuccessful IPOs

the high first-day abnormal returns of IPO firms implies that markets are not efficient

because of growth options, venture capitalists should sometimes finance projects whose first-stage value has a negative NPV

because of growth options, venture capitalists should never finance projects whose first-stage value has a negative NPV

empirical studies suggest that the stock price of target firms usually increases while the price of acquiring firms decreases a bit, on average

empirical studies suggest that the stock price of acquiring firms usually increases while the price of target firms decreases a bit, on average