This project is to examine the debt ratios of Australia public listed firms and also to see if there
is any correlation between debt of firms with (1) firm characteristic variables and/or (2)
firm policy decision variables.
For firm characteristics variables, you are to extract the following information for the last
3 years for each of the company:
– firm size – natural log of firm’s total assets (TA), predicted relationship +ve
– capital intensity – ratio of PPE/TA, predicted relationship +ve
– non-debt tax shield – depreciation/TA, predicted relationship –ve
– profitability – net income/TA, predicted relationship –ve
– growth opportunities – market to book value (MBV), predicted relationship,
mixed results.
For policy and decision variables, you are to extract the following information for the last 3 years for each of the company:
– Dividends over the period/TA, predicted relationship +ve
– Sales of common stock/TA, predicted relationship –ve