Asked by
Julie Campeggi
on Nov 07, 2024
Verified
The capital structure of a firm refers to the firm's:
A) Ratio of fixed assets to total assets.
B) Mix of long-term assets including such things as office buildings, manufacturing facilities, and equipment.
C) Financing arrangements as evidenced by the firm's debt-equity ratio.
D) Ability to generate sales by utilizing the fixed assets of the firm.
E) Issuance of equity securities in the firm.
Capital Structure
The mix of different forms of external funds and equity used by a firm to finance its overall operations and growth.
Debt-Equity Ratio
This metric calculates the relative use of debt and shareholders' equity in financing assets for a company.
- Understand the concept of capital structure and the relevance of debt-equity ratios.
Verified Answer
FL
Learning Objectives
- Understand the concept of capital structure and the relevance of debt-equity ratios.