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Study On Appreciation Of Financial Equilibrium In The Companies Listed On The Bucharest Stock Exchange

Author

Listed:
  • BALTES Nicolae

    (Lucian Blaga University of Sibiu)

  • PAVEL Ruxandra Maria

    (Lucian Blaga University of Sibiu)

Abstract

This paper presents the development of two important indicators in assessing the financial equilibrium of an economic entity, namely the working capital and financial leverage for 24 companies listed and traded on the Bucharest Stock Exchange, that belong to industry hotels and restaurants, during a period of 8 financial years (2007-2014). Starting from 2011 the economic and financial crisis had a severe impact on the companies included in the research, the financial health been altered to the extent that half of the companies registered a state of financial disequilibrium. By using simple linear regression model, it was concluded that the change in value of financial leverage has a strong influence of the opposite size on the working capital.

Suggested Citation

  • BALTES Nicolae & PAVEL Ruxandra Maria, 2016. "Study On Appreciation Of Financial Equilibrium In The Companies Listed On The Bucharest Stock Exchange," Revista Economica, Lucian Blaga University of Sibiu, Faculty of Economic Sciences, vol. 68(4), pages 33-43, December.
    • Handle: RePEc:blg:reveco:v:68:y:2016:i:4:p:33-43
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    More about this item

    Keywords

    financial equilibrium; working capital; financial leverage; linear regression; permanent capital;
    All these keywords.

    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • C26 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Instrumental Variables (IV) Estimation

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