Capital Structure Pecking Order Theory Financial Essay
Thus, this theory states that there is no optimal capital structure 21. However, it has been argued that the pecking order theory starts with equity financing and ends with the same thing, forwarding. This study aims to determine the optimal capital structure that increases firm value, leading to the trade-off theory and pecking order theory in Indonesia with a research period of years. Capital structure theory is the analysis of this important business question. The net income approach, static trade-off theory, and pecking order theory are three financial principles that help: The Pecking Order Theory provides a framework for understanding companies' financing decisions. It provides insight into why companies prioritize certain sources of financing over others and how this decision-making process affects their capital structure. One of the main drivers of the Pecking Order Theory is the concept,