Baseline parameter values
| Risk-free rate | r = 4% |
| Debt maturity | m = 1 |
| Death rate | ϕ = 4% |
| Asset growth rate | μ = 3% |
| Asset volatility | σ = 20% |
| Principal payment | P = 100 |
| Coupon size | c = 9 |
| High productivity | αh = 80% |
| Low productivity | αl = 40% |
| Asset size of a new firm | xN = 7.4 |
| Risk-free rate | |
| Debt maturity | |
| Death rate | |
| Asset growth rate | |
| Asset volatility | |
| Principal payment | |
| Coupon size | |
| High productivity | |
| Low productivity | |
| Asset size of a new firm |
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