The researchers' understandings on the relevance of corporate capital structure decisions have been shifted from the examination of the irrelevance argument to the relevance argument and its different facets. In the literature, the modern theories have overemphasized on the different “points...

In explaining the dynamics of corporate Reserve Debt Capacity (RDC) at its utilization and creation of the high-risk and low-risk RDC by the high-value and low-value firms, the present paper seeks to put forward a new theory in literature. Utilizing the concept of suboptimality at firms’...