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Which of the following statements is true about capital structure. a.Capital structure refers to...

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Finance

  1. Which of the following statements is true about capital structure.

a.Capital structure refers to how the value of the total assets of a firm are distributed over the various components of capital structure such as debt and equity.

b.The Optimal capital structure is the minimal debt-to-equity ratio for a firm that maximizes its value.

c.A company's risk generally increases as debt increases.

  1. A firm's debt-to-cash ratio impacts the firm's borrowing costs and its value to shareholders.

a.True

b.False

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