- CFA Exams
- CFA Level I Exam
- Topic 3. Corporate Issuers
- Learning Module 6. Capital Structure
- Subject 2. Factors Affecting Capital Structure
CFA Practice Question
For a company at the maturity stage, A. revenue growth may slow down or even decline, reducing its debt capacity.
B. growth-related investment spending may increase.
C. debt financing is likely to be more attractive than equity financing.
Correct Answer: C
A: Its debt capacity may increase due to stable cash flows. B: it may decline. C: This is because equity financing has a higher cost than debt financing.
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