What alternative investment and financing instruments can firms use to alter their marginal tax rate Why might the firm prefer to repackage its capital structure (the mix of financial instruments it issues to finance operations) instead of changing its operating decisions to effect clientele based ...

Firms can alter their marginal explicit tax rates by undertaking clientelebased arbitrage activities For example a lowtax firm should invest any spare ...

What alternative investment and financing instruments can firms use to alter their marginal tax rate? Why might

Question:

What alternative investment and financing instruments can firms use to alter their marginal tax rate? Why might the firm prefer to repackage its (the mix of financial instruments it issues to finance operations) instead of changing its operating decisions to effect clientele-based arbitrage?
Capital Structure
Capital structure refers to a company’s outstanding debt and equity. The capital structure is the particular combination of debt and equity used by a finance its overall operations and growth. Capital structure maximizes the market value of a...