Adjusted Present Value for Optimizing Debt

Estimate an "optimal" Capital Structure for a company using the Adjusted Present Value Approach.

adjusted present valuecapital structurecost of capitaldebt ratiofinanceoptimizing debt

The excel model spreadsheet summary provides a picture of your firm's current cost of capital and debt ratio, and compares it to your firm's value at every debt ratio, incorporating the tax benefits from debt & the expected bankruptcy costs at each level of debt.

This spreadsheet allows you to compute the optimal capital structure for a non-financial service firm.

Note: this model is being shared with the authorization of Professor Aswath Damodaran from NYU Stern Business School (

This business tool includes
1 Excel Model File

Prof. Aswath Damodaran offers you this business tool for free!

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