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    Corporate finance and the theory of the firm

     
    Corporate finance and the theory of the firm

    Description

    Research Paper (undergraduate) from the year 2003 in the subject Business economics - Investment and Finance, grade: 2,0 (B), European Business School - International University Schloß Reichartshausen Oestrich-Winkel (Corporate Finance and Capital Markets), language: English, abstract: This book examines the links between corporate finance and the theory of
    the firm. As a basis for this analysis, theoretical foundations in corporate finance and
    the theory of the firm are provided. Furthermore, current research on the theory of the
    firm and corporate finance for the recently emerged type of firm of the human-capital
    intensive firm is presented.
    The most significant part of the analysis is the evaluation of the interrelation between
    corporate finance and the theory of the firm using a 3x3 matrix. This matrix compares
    three important theoretical frameworks of the firm (the firm as a nexus of contracts, as a
    collection of growth options and as a collection of assets) with three major fields of
    corporate finance (capital structure, corporate governance and valuation). This
    assessment is done for the traditional asset-intensive industrial firm, one of two basic
    types of firms in today's economy. For giving an additional insight into current
    research, the recently emerged human-capital intensive firm is shortly described in
    comparison to the traditional asset-intensive firm, and implications for corporate finance
    for this new type of firm are explained.
    As a conclusion, three major results can be stated: firstly, the theory of the firm definitely
    influences corporate finance for all described views of the firm, and it is thus an
    important basis for corporate finance. This fact makes it necessary to consider the underlying
    issue of the theory of the firm for each problem in corporate finance. Secondly,
    different views of the theory of the firm have different implications for corporate finance.
    For example, the appropriate valuation method depends on the considered view
    of the firm. A third result being observed is that corporate finance and the theory of the
    firm are in an ongoing change. An example of this is the emergence of human-capital
    intensive firms within the last decade.

    Product details

    EAN/ISBN:
    9783638842402
    Edition:
    2.
    Medium:
    Paperback
    Number of pages:
    40
    Publication date:
    2007-11-09
    Publisher:
    GRIN Verlag
    EAN/ISBN:
    9783638842402
    Edition:
    2.
    Medium:
    Paperback
    Number of pages:
    40
    Publication date:
    2007-11-09
    Publisher:
    GRIN Verlag

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