The Impact of Economic Performance on the Financial Position

Author:Univ. Prof. PhD Ana MORARIU, Univ. Lecturer PhD Cornel Dumitru CRECANĂ

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Keywords:economic performance, capital structure, leverage ratio, equity capitals

Abstract:
This paper intends to prove the importance of capital structure optimization concerning economical performance. The surest way for financing the exploitation cycle is using the benefits of leverage ratio.\r\nAlso, the optimization of current assets and following theirs dynamics, in correlation with entity net turnover is offering the possibility to make a correct choice of financial sources.\r\nThe actual financial structure is giving by the justice or injustice of past decisions, the optimization of financial structure must count relevant past mistakes, constraints which the scarcity of money is giving to the exploitation cycle, in the context of global financial crisis. \r\nFinally, any entity must analyze the profitability and make good choices concerning optimal use of equity capital and borrowed capital.

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