VTechWorks staff will be away for the Thanksgiving holiday beginning at noon on Wednesday, November 27, through Friday, November 29. We will resume normal operations on Monday, December 2. Thank you for your patience.
 

Interactions of investment opportunities and financing decisions

Simple item page
dc.contributor.authorSarin, Atulyaen
dc.contributor.committeechairPinkerton, John M.en
dc.contributor.committeememberDenis, David J.en
dc.contributor.committeememberHansen, Robert S.en
dc.contributor.committeememberKeown, Arthur J.en
dc.contributor.committeememberShome, Dilip K.en
dc.contributor.departmentFinanceen
dc.date.accessioned2014-03-14T21:15:06Zen
dc.date.adate2006-06-19en
dc.date.available2014-03-14T21:15:06Zen
dc.date.issued1992en
dc.date.rdate2006-06-19en
dc.date.sdate2006-06-19en
dc.description.abstractThis study examines how the investment opportunity set of the firm affects financing choices the firm makes. In a two-period, one decision, no-tax model, we show that firms characterized by a high level of investment opportunities in future periods issue equity and convertible securities while firms with fewer investment opportunities in future periods issue straight debt. Our empirical design improves upon previous studies in two important ways. First, we treat convertible debt separately from straight debt. Second, in addition to examining the correlation between investment opportunity and debt-asset ratios, we examine the incremental financing decision using discrete choice analysis. We find that the level of investment opportunities of firms making public issues of equity and convertible debt are higher than those issuing straight debt. Also, there is a negative correlation between investment opportunities and debt-asset ratios. We interpret these results to mean that investment opportunities are an important determinant of the firm’s financing policy. The direction of this relationship is the same as that predicted by the tax models of DeAngelo and Masulis (1980) and Dotan and Ravid (1985), and agency models of Myers (1977), Jensen (1986) and Stulz (1990).en
dc.description.degreePh. D.en
dc.format.extentvii, 74 leavesen
dc.format.mediumBTDen
dc.format.mimetypeapplication/pdfen
dc.identifier.otheretd-06192006-125727en
dc.identifier.sourceurlhttp://scholar.lib.vt.edu/theses/available/etd-06192006-125727/en
dc.identifier.urihttp://hdl.handle.net/10919/38633en
dc.language.isoenen
dc.publisherVirginia Techen
dc.relation.haspartLD5655.V856_1992.S275.pdfen
dc.relation.isformatofOCLC# 28277202en
dc.rightsIn Copyrighten
dc.rights.urihttp://rightsstatements.org/vocab/InC/1.0/en
dc.subject.lccLD5655.V856 1992.S275en
dc.subject.lcshCorporations -- Finance -- Decision makingen
dc.subject.lcshCorporations -- Financeen
dc.subject.lcshSaving and investment -- Decision makingen
dc.subject.lcshSaving and investmenten
dc.titleInteractions of investment opportunities and financing decisionsen
dc.typeDissertationen
dc.type.dcmitypeTexten
thesis.degree.disciplineFinanceen
thesis.degree.grantorVirginia Polytechnic Institute and State Universityen
thesis.degree.leveldoctoralen
thesis.degree.namePh. D.en

Files

Original bundle
Now showing 1 - 1 of 1
Thumbnail Image
Name:
LD5655.V856_1992.S275.pdf
Size:
3.34 MB
Format:
Adobe Portable Document Format
Description:
Download

Collections

Doctoral Dissertations