Optimal capital structure: Difference between revisions
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imported>Doug Williamson (Layout.) |
imported>Doug Williamson (Remove surplus link.) |
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* [[Pecking order theory]] | * [[Pecking order theory]] | ||
* [[Weighted average cost of capital]] | * [[Weighted average cost of capital]] | ||
[[Category:Corporate_finance]] | [[Category:Corporate_finance]] | ||
[[Category:Long_term_funding]] | [[Category:Long_term_funding]] | ||
Revision as of 20:23, 9 February 2019
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).
