THE STUDY OF RELATIONSHIP BETWEEN CAPITAL STRUCTURE, FIRM GROWTH WITH FINANCIAL LEVERAGE OF THE COMPANY LISTED IN TEHRAN STOCK EXCHANGE

Abstract

One of the most important issues that financial managers must consider in order to maximize shareholders wealth is to determine the best combination of company resources or the capital structure. The capital structure puzzle is one of the most important issues in the financial management and it is even more complicated than the dividend puzzle. The discussion of capital structure refers to the method of combination of companies financing sources, including debts, preferred stock and common
stock. In this research, the relationship between the ownership structure, corporate growth with corporate financial leverage is addressed in companies being accepted in Tehran Stock Exchange using deducted simultaneous equation systems and panel data relating to 2007 – 2011. Generally, research findings indicate a relationship between the ownership structure, corporate growth and companies ‘administrative financial leverage.