Which one of the following would not be expected to change with changes in the firm's capital structure?
A) Weighted-average cost of capital
B) Expected return on equity
C) Expected return on assets
D)Expected earnings per share

Question

Quizplus · Accepted Answer

The expected return on assets is determined by the firm's operating performance and does not depend on the capital structure. The other options, weighted-average cost of capital, expected return on equity, and expected earnings per share, are all affected by changes in the capital structure as they are related to the financing mix of the firm.

Which One of the Following Would Not Be Expected to Change