Optimal capital structure: Difference between revisions
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(i) | (i) The immediate cost saving benefits of a low WACC. | ||
(ii) The potential flexibility and safety benefits of a more conservative capital structure (with a relatively lower proportion of debt finance). | |||
(ii) | |||
Revision as of 15:59, 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 immediate cost saving benefits of a low WACC.
(ii) The potential flexibility and safety benefits of a more conservative capital structure (with a relatively lower proportion of debt finance).