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SEPTEMBER 2012 (published: 10.09.2012)
Number 2(11)
Home > Issue > Financial leverage and Its Determinants
Laskina L.Y.
The article examines the determinants of financial leverage which are analyzed in foreign empirical studies. It is shown that financial leverage is directly related to the firm’s size, firm’s growth, collateral value of assets and non-debt tax shield. Such factors as interest coverage ratio and political risk can be considered to have an adverse effect on financial leverage level.
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Keywords: financial leverage, determinants, firm size, profitability, interest coverage ratio
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License
UDC 336.648
Financial leverage and Its Determinants
The article examines the determinants of financial leverage which are analyzed in foreign empirical studies. It is shown that financial leverage is directly related to the firm’s size, firm’s growth, collateral value of assets and non-debt tax shield. Such factors as interest coverage ratio and political risk can be considered to have an adverse effect on financial leverage level.
Read the full article
Keywords: financial leverage, determinants, firm size, profitability, interest coverage ratio