CFA Practice Question

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CFA Practice Question

Which of the following refers to capital structure?

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
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