題組內容

1. (15 points) Capital structure overlooks that firms have different capital requirements across their life cycle. In addition, the finance literature highlights various theoretical models that explain how the firms' life stages influence capital struc cture decisions, such as the Pecking Order, Trade-Off, and Agency Cost Theories. We like to know how firms in highly innovative industries have' different capital requirements over their life cycle.

(2) (5 points) When firms are matured, they are more likely to use debt or equity financing, why?