Opportunity risk and Optimal capital structure: Difference between pages
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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 benefits of a more conservative capital structure (with a relatively lower proportion of debt finance). | |||
== See also == | == See also == | ||
* [[ | * [[Capital structure]] | ||
* [[Modigliani and Miller]] | |||
* [[Pecking order theory]] | |||
* [[Weighted average cost of capital]] | |||
* [[MCT]] | |||
[[Category:Corporate_finance]] | |||
[[Category:Long_term_funding]] | |||
Revision as of 12:12, 11 May 2016
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 benefits of a more conservative capital structure (with a relatively lower proportion of debt finance).
