*2.5. Growth*

The pecking order theory states that there is a positive relationship between growth and debt. Companies with high growth rates need sufficient funds to support their investment opportunities and internal funds are unlikely to be enough to support them. Trade-off theory states that there is a negative relationship, assets intangibility of firms with high growth rates implies the risk of losing value in case of financial distress. (Chaklader and Chawla 2016; Psillaki and Daskalakis 2009) showed that the growth variable is statistically insignificant, contrary to (Alipour et al. 2015; Cortez and Susanto 2012) who concluded that the relationship between the growth variable and the dependent variable is significantly negative.

#### *2.6. Inflation*

Chadha and Sharma (2015) found that inflation is statistically insignificant. Bokpin (2009) obtained a significant relationship. In most cases, firms will resort to internal sources of financing during periods when inflation is high, as this pressure will increase the cost of obtaining capital from creditors.
