DISCUSSION.

It is rather unusual to find all the papers presented in one of these sessions adhering so closely to the session title. I am taking note of this point to emphasize the unusual commonality of the two papers. Namely, both papers use the two parameter CAPM as their basic framework, and both papers investigate (or better, reinvestigate) classic, fundamental corporate finance issues. These are not trivial or second order issues undertaken in the two papers--capital budgeting, capital structure and dividend policy have always been at the core of corporation finance. But there is even a third similarity between these two papers; and that is, they both use numerical examples and solutions to illustrate some very difficult conceptual and analytical problems and to draw general conclusions. In many of the topics or cases studied in the two papers, analytical solutions were extremely complex or impossible, so that the usefulness of numerical examples was clearly demonstrated. [ABSTRACT FROM AUTHOR]