Capital structure determines the level of current assets that is required to maintain the ﬁrm's
operational level.

Question

Quizplus · Accepted Answer

Capital structure primarily refers to the mix of debt and equity financing used by a company to fund its operations and investments. It does not directly determine the level of current assets needed for the firm's operations, although the amount of funding obtained through capital structure may affect the firm's investment decisions and subsequent need for current assets.

Capital Structure Determines the Level of Current Assets That Is