scholarly journals Bankruptcy costs, liability dollarization, and vulnerability to sudden stops

2011 ◽  
Vol 95 (2) ◽  
pp. 201-211 ◽  
Author(s):  
Uluc Aysun ◽  
Adam Honig
Keyword(s):  
Sudden Stops ◽  
Liability Dollarization ◽  
Bankruptcy Costs

A Single Period Stochastic Model for Maximising Firms Value

GIS Business ◽  
2016 ◽  
Vol 11 (6) ◽  
pp. 39-45
Author(s):  
J. P. Singh
Keyword(s):  
Capital Market ◽  
Firm Value ◽  
Capital Asset Pricing ◽  
Capital Asset ◽  
Asset Pricing Model ◽  
Value Maximization ◽  
Risk Return ◽  
Bankruptcy Costs ◽  
Single Period ◽  
Debt Capacity

This article sets up a single period value maximization model for the firm based on stochastic end-of-period cash inflows, stochastic bankruptcy costs and taxes based on income rather than wealth. The risk-return trade-off is captured in the Capital Asset Pricing Model. Thus, the model also assumes a perfect capital market and market equilibrium. The model establishes the existence of a unique optimal financial leverage at which the firm value is maximized, this leverage being less than the maximum debt capacity of the firm.

scholarly journals A new taxonomy of Sudden Stops: Which Sudden Stops should countries be most concerned about?

2015 ◽  
Vol 51 ◽  
pp. 47-70 ◽  
Author(s):  
Eduardo Cavallo ◽  
Andrew Powell ◽  
Mathieu Pedemonte ◽  
Pilar Tavella
Keyword(s):  
Sudden Stops
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