Marketing: How does business debt affect firm value and consumer satisfaction?

Wednesday, September 23, 2015 - 15:20 in Mathematics & Economics

Feeling less satisfied with the businesses you patronize? It might be because those businesses are in a lot of debt. According to a new study in the Journal of Marketing, a company that has a lot of financial leverage—that is, a company that has a lot of debt in relation to its value—spends a lot less on advertising, which in turn decreases customer satisfaction.

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