Session 20: Following up on optimizing debt mix
from Aswath Damodaran Hosted by Aswath Damodaran
We started this class with the adjusted present value approach, where we begin with the unlevered firm value, and then add the tax benefits of debt and net out expected bankruptcy costs. We then looked at peer group analysis, where companies decide how much to borrow by looking at what other companies in the sector do. You can check out the debt ratios for other companies in your sector by going to my website:US industry averages: http://www.stern.nyu.edu/~adamodar/pc/datasets/dbtfund.xlsGlobal industry averages: http://www.stern.nyu.edu/~adamodar/pc/datasets/dbtfundGlobal.xlsSlides: https://pages.stern.nyu.edu/~adamodar/podcasts/cfspr23/session20slides.pdfPost class test: https://pages.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session20test.pdfPost class test solution: https://pages.stern.nyu.edu/~adamodar/pdfiles/cfovhds/postclass/session20soln.pdf
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