A firm's capital structure refers to the
A)division of a firm's assets into current and fixed assets.
B)amount shareholders have invested into the firm.
C)types of fixed assets owned by the firm.
D)mix of debt and equity used to finance the firm's assets.
E)amount of cash and cash equivalents held by a firm.

Question

Quizplus · Accepted Answer

A firm's capital structure refers to the mix of debt and equity used to finance the firm's assets. It is the way a company finances its operations and growth by using different sources of funds, including equity, debt, and hybrid securities. A company's capital structure can have a significant impact on its profitability, financial flexibility, risk profile, and cost of capital.

A Firm's Capital Structure Refers to the