Abstract

IZAR LANDETA, Juan Manuel  and  YNZUNZA CORTES, Carmen Berenice. Comparative study of four financing plans with debt in investment projects. Investig. adm. [online]. 2013, vol.42, n.112, pp.7-22. ISSN 2448-7678.

This paper makes a comparative analysis of four plans of debt to finance investment projects. These plans are: (a) mortgage, (b) payment at maturity, (c) bond and (d) constant amortization mortgage. The attractiveness of the project has been measured by net present value (NPV).

In general, the best result is achieved with the third plan, the two mortgage plans produce very similar NPV and the worst result was the plan (b), which is because it is wasted the advantage of the tax deductibility of interest payments. However, this does not apply in a broad sense; it depends on the variables involved, such as the rate of debt, financial leverage, the tax rate and the return required by investors.

Keywords : tax deductibility; financial leverage; capital structure; capital cost.

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