Which One of the Following Would Not Be Expected to Change

question 72

Multiple Choice

Which one of the following would not be expected to change with changes in the firm's capital structure?

• A) Weighted-average cost of capital
• B) Expected return on equity
• C) Expected return on assets
• D)Expected earnings per share

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Definitions:

C Corporation

An organizational form for businesses where shareholders, the owners, face taxation independently from the corporation.

Shareholders

Individuals or entities that own shares in a corporation, thus having a claim on part of its assets and earnings.

Legally Liable

Being subject to legal responsibility or obligation, particularly in the context of lawsuits or compensations.

Sole Proprietorship

A business ownership structure where a single individual owns, operates, and is responsible for all aspects of the business.