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EBIT-EPS Model

EBIT refers to a company's earnings before interest and taxes. EPS stands for earnings per share.To define the capital structure to maximization of earnings per share of a company before interest and taxes is "EBIT-EPS Model".

About this model L.G. Gitman said,” The EBIT-EPS approach to capital structure involves selecting the capital structure, that maximizes EPS over the expected range of earnings before interest and Taxes (EBIT).”

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