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Basic Question 1 of 15

The objective of the firm should be to ______ when choosing a capital structure.

A. choose one that results in the largest interest tax shield
B. choose one that minimizes the firm's WACC
C. choose any capital structure since capital structure is always irrelevant
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User Contributed Comments 1

User Comment
DonAnd I narrowed it down to B or E and it definitely won't be E so voila B it is. :-)
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I passed! I did not get a chance to tell you before the exam - but your site was excellent. I will definitely take it next year for Level II.
Tamara Schultz

Tamara Schultz

Learning Outcome Statements

describe optimal and target capital structures

CFA® 2024 Level I Curriculum, Volume 2, Module 6.