Firm Size 's Impact On The Access Of Capital Markets

Better Essays

1.2 Thesis Statement
My Main thesis statement is:
“Firm size has an impact on the access to capital markets”
My main aim is to examine if there is truly a relationship between the amount of debt firms hold and the firms size. Larger firms these days seem to be able to borrow large amounts of money than that of smaller firms. I will approach this statement by focusing on the size of the firm itself by using their Total Assets value and relating this to their long term debt figure. I gathered a sample data of 274 firms within the UK of various sizes and debt levels and I will use the data gained to determine whether a relationship truly exists.
1.3 Main Findings
The amount of debt a company held varied throughout my data gathered from …show more content…

Profitability provided a negative relationship with financial leverage while Ratio of Tangibility provided a positive relationship. These both agree with our theory however they were again statistically insignificant and therefore we reject the null hypothesis.
1.4 Layout
The aim of this paper is to identify if certain variables are determinants of financial structure. I have structured the paper in the following way. In section 2 I have carried out a literature review on this topic from historical papers and past researchers. I have also stated the hypothesis’s that I will be testing and why. Section 3 contains the data set I will be using, the variables included and my methodology approach and how I am going to test my hypothesis. In section 4, which is the main part of my paper contains my results in table format along with detailed explanations of these results while also testing if they are statistically significant. The final section, section5 I have commented my outcomes and possible way to enhance these results in the future.
2. Literature Review
The determinants of financial structure have been looked on a consistent basis over many years. Recently it has been looked at in extreme detail due to the Financial Crisis which has had a major impact on firms due to the

Get Access