- CFA Exams
- CFA Level I Exam
- Topic 3. Corporate Issuers
- Learning Module 6. Capital Structure
- Subject 1. The Cost of Capital
CFA Practice Question
Which of the following refers to capital structure?
B. The size, timing, and risk of a firm's future cash flows
C. The amount of short-term assets and short-term liabilities a firm has on its balance sheet
D. The types of projects a firm invests in
E. The mixture of short-term and long-term debt a firm uses to finance its operations
A. The amount of long-term debt and equity a firm has on its balance sheet
B. The size, timing, and risk of a firm's future cash flows
C. The amount of short-term assets and short-term liabilities a firm has on its balance sheet
D. The types of projects a firm invests in
E. The mixture of short-term and long-term debt a firm uses to finance its operations
Correct Answer: A
User Contributed Comments 6
| User | Comment |
|---|---|
| setmefree | so that short term debt and equity levels are irrelevant in firm's capital structure? um.... |
| danlan2 | "A firm plans to maintain over time" means long-term. |
| fanDango | Capital structure refers to the balance of debt to equity. |
| Salim6 | Why not E ? |
| reccy | Capital structure: debt/bonds, retained earnings/ stocks, preferred stock (all long term) Short term debt: AP etc not in definition of capital structure |
| khalifa92 | short term is related to working capital |