CAPITAL STRUCTURE OF MANUFACTURING FIRMS IN NIGERIA A CRITICAL ANALYSIS OF FOODS, BEVERAGES AND TOBACCO SECTOR

📄 Project Abstract

Capital structure, otherwise referred to as, financial structure, is the means by which an organization is financed. It is the mix of debt and equity capital maintained by a firm. The extant literature is awash with theories on capital structure since the seminal work of Modigliani and Miller (1958). How an organization is financed is of paramount importance to both the managers of firms and providers of funds. This is because if a wrong mix of finance is employed, the performance and survival of the business enterprise may be seriously affected. This study wants to contribute to the debate on the relationship between capital structure and firm performance from the agency cost theory perspective using Nigerian data. This study seeks to provide answer to the question, does capital structure affects financial performance of firms? Data of thirty firms listed on the Nigeria Stock Exchange (NSE) between 2001 and 2007, representing 210- firm year observations was used for the study. An effi...