A firm's capital structure is defined as follows
A) As the combination of debt and equity used to finance the firm's operations.
B) By the types of fixed assets the firm owns.
C) As the mix of short-term and long-term assets owned by the firm.
D) As the amount of fixed assets needed to support every $1 in sales.
E) By the nature of the product or service provided.

Question

Quizplus · Accepted Answer

A firm's capital structure refers to the specific mixture of long-term debt and equity that a company uses to finance its operations and growth. This includes common equity, preferred equity, and any type of debt the firm might have.

A Firm's Capital Structure Is Defined as Follows