Top 4 Theories of Capital Structure

This article throws light upon the top four theories of capital structure. The theories are: 1. Net Income Approach 2. Net Operating Income Approach 3. Traditional Approach 4. Modigliani-Miller Approach. Theory # 1. Net Income (NI) Approach: David Durand' suggested the two famous capital structure theories, viz, Net Income Approach and the Operating Income Approach: According to NI approach a [...]