A Change in the Company's Capital Structure Will Change the Amount

question 44

True/False

A change in the company's capital structure will change the amount of taxes paid but will not change the WACC.
FALSE

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Definitions:

Shares

Shares representing ownership rights in a corporation or financial asset, guaranteeing a fair share of profits through dividends, if declared.

Par Common Stock

This represents the nominal or face value assigned to common stock shares, which is the minimal amount shareholders must contribute and is not necessarily related to the market value.

Market Price

The current value at which an asset or service can be bought or sold in a transaction between willing parties.

Shares

Portions of ownership in a company or finance asset, ensuring equitable division of profits through dividends, whenever they are declared.