What kinds of firms influenced by underinvestment costs

Reference no: EM131241374

1. Give an example of an underinvestment problem.

2. What kinds of firms are most likely to be influenced by underinvestment costs when choosing a capital structure?

3. Give an example of a reluctance-to-liquidate problem. Is this an issue that could hurt only the creditors, or only the shareholders?

4. What kinds of firms are most likely to be influenced by possible reluctance-to-liquidate costs when choosing a capital structure?

Reference no: EM131241374

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