Advances in Economics, Management and Political Sciences
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Proceedings of the 2023 International Conference on Management Research and Economic Development
Series Vol. 19 , 13 September 2023
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Relationship Between Corporate Capital Structure and Company Value — Based on the CAPM and APT model and the WACC analysis
* Author to whom correspondence should be addressed.
Abstract
The core of financial management and investment activities is to maximize the wealth of the company and shareholders. Company value maximization is inseparable from shareholder value maximization. Due to the fact that the structure of company's capital would influence the level of profit return and the circumstance of cash flow, the management for financial framework is a significant connection between the economic situation of the corporation, by which it can benefit the value. The author briefly analyzed the CAPM since it is not an accurate model, which has unrealistic assumptions and the disadvantages of unrest, by using the APT model to replace the CAPM model to study the arbitrage pricing model and its relationship with the capital asset pricing model (CAPM). From the analysis of these models and the introduction of four capital structure theories, the connection between corporation capital structure and corporate value is further studied.
Keywords
capital structure, M & M theory, WACC, CAPM, APT
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Data Availability
The datasets used and/or analyzed during the current study will be available from the authors upon reasonable request.
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- Volume Title
- Proceedings of the 2023 International Conference on Management Research and Economic Development
- ISBN (Print)
- 978-1-915371-81-2
- ISBN (Online)
- 978-1-915371-82-9
- Published Date
- 13 September 2023
- Series
- Advances in Economics, Management and Political Sciences
- ISSN (Print)
- 2754-1169
- ISSN (Online)
- 2754-1177
- DOI
- 10.54254/2754-1169/19/20230125
- Copyright
- 13 September 2023
- Open Access
- This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited