Optimal capital structure: Difference between revisions
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imported>Doug Williamson (Spacing) |
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The capital structure which results in the lowest Weighted Average Cost of Capital (WACC). | The capital structure which results in the lowest Weighted Average Cost of Capital (WACC). | ||
2. | 2. | ||
The most appropriate capital structure taking account of both: | The most appropriate capital structure taking account of both: | ||
(i) the cost saving benefits of a low WACC, and | (i) the cost saving benefits of a low WACC, and | ||
(ii) the potential flexibility and safety benefits of a more conservative capital structure (with a relatively lower proportion of debt finance). | (ii) the potential flexibility and safety benefits of a more conservative capital structure (with a relatively lower proportion of debt finance). | ||
== See also == | == See also == | ||
Revision as of 15:57, 12 June 2013
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:
(i) the cost saving benefits of a low WACC, and
(ii) the potential flexibility and safety benefits of a more conservative capital structure (with a relatively lower proportion of debt finance).
