The Firm's Target Capital Structure Should Be Set to Do

question 16

Multiple Choice

The firm's target capital structure should be set to do what?

• A) Maximize the earnings per share (EPS).
• B) Minimize the cost of debt (rd).
• C) Minimize the cost of equity (rs).
• D) Minimize the weighted average cost of capital (WACC).

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Definitions:

Theory of Constraint (TOC)

A management philosophy that focuses on identifying and removing bottlenecks or constraints that limit the performance of a system.

Ethical Responsibility

The duty of individuals and corporations to act in ways that benefit not just themselves but also society, often beyond legal obligations.

Codes of Conduct

Written guidelines designed to set out acceptable behaviors for members of a particular group, organization, or profession.

Management Accountants

Professionals specializing in accounting who analyze financial information to advise business strategy and financial management.