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What factors often lead to financial distress for a firm? What are the costs of financial distress? How does the affect the optimal capital structure

  1. What factors often lead to financial distress for a firm? What are the costs of financial distress?
  2. How does the affect the optimal capital structure of a firm?
  3. What factors determine if a company in financial distress ends in bankruptcy (liquidation) or restructuring?
  4. Why is Economic Value Added (EVA) a good indicator of managerial performance?
  5. What are some of the shortcomings of EVA?
  6. What is the difference between hedging and investing? Between investing and speculating?

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