| Fisher Separation Theorem |
Article Index for Fisher |
Website Links For Fisher |
Information AboutFisher Separation Theorem |
| CATEGORIES ABOUT FISHER SEPARATION THEOREM | |
| economics theorems | |
|
:The Fisher Separation Theorem states that: # the firm's investment decision is independent of the preferences of the owner; # the investment decision is independent of the financing decision. Fisher showed the above as follows: The firm can make the Investment Decision — i.e. the trade off in productive opportunities — that maximizes its present value, independent of its owner's investment preferences. The firm can ''then'' ensure that the owner achieves his optimal position in terms of "market opportunities" — i.e the position he would have taken in the available productive opportunities — by funding its investment either with borrowed funds, or internally as appropriate. SEE ALSO EXTERNAL LINKS |
|
|