Optimal capital structure: Difference between revisions
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Latest revision as of 16:21, 20 September 2025
Corporate finance - capital management.
1.
The capital structure which results in the lowest Weighted Average Cost of Capital (WACC).
2.
The most appropriate capital structure taking account of both:
- The immediate cost saving benefits of a low WACC.
- The potential flexibility and safety-robustness benefits of a more conservative capital structure (with a relatively lower proportion of debt finance).
