- CFA Exams
- CFA Level I Exam
- Study Session 7. Corporate Finance (1)
- Reading 20. Capital Structure
- Subject 1. Capital structure irrelevance theory
CFA Practice Question
Which of the following is correct?
A. The optimal capital structure is the one that gives the maximum value to equity holders.
B. The optimal capital structure is the one that gives the maximum EPS.
C. The optimal capital structure is the one that gives the maximum WACC.
Explanation: In corporate finance optimal is that which makes the owners (shareholders) most wealthy.
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