*2.4. Size*

It is assumed that there is a positive relationship between firm size and debt, according to trade-off theory, because larger firms are more diversified and tend to have lower variance of profits, allowing them to tolerate higher debt ratios. In contrast, pecking order theory predicts a negative relationship, due to the fact that larger firms deal with lower adverse selection and have the ability to issue equity more easily compared to small businesses. (Chaklader and Chawla 2016; Psillaki and Daskalakis 2009; Rajan and Zingales 1995; Song 2005) achieved a positive association. Alipour et al. (2015) obtained an inverse relationship, concluding that small companies have no option but to resort to bank loans. (Cortez and Susanto 2012; Viviani 2008) found the relationship between size and debt ratio insignificant.
