The underinvestment problem describes the conundrum whereby a company becomes so over-leveraged that it can no longer invest in growth opportunities.
Economists recognize this situation as an agency problem that can arise between a firm’s debt holders and shareholders.
The overbalance of debt, both from the point of view of corporations and governments, is a form of underinvestment problem that negatively affects both shareholders and citizens of the country.
Quasi-reorganization allows the company to eliminate the deficit of retained earnings by recalculating assets, liabilities and equity in the manner characteristic of bankruptcy.
Zombie debt is debt that has expired for collection.
“Despite that, the collection agencies may try to collect the debt from him, in a sense, bring him back from the dead.
Performance Based Management (ABM) is a means of analyzing a company’s profitability by looking at every aspect of its business to determine its strengths and weaknesses.
Share capital is the number of ordinary and preferred shares that the company has the right to issue and which are accounted for on the balance sheet as part of share capital.