Bankruptcy cost view(redirected from Bankruptcy Cost Views)
Bankruptcy cost view
The argument that expected indirect and direct bankruptcy costs offset the other benefits from leverage so that the optimal amount of leverage is less than 100% debt financing.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.
Bankruptcy Cost View
A theory stating that the costs of bankruptcy offset or exceed the benefits a company receives from a great deal of leverage. Followers of this view recommend companies maintain less than 100% leverage.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved