The Capital Structure of a Company Is One of the Important

question 92

Multiple Choice

The capital structure of a company is one of the important indicators of performance.Which of the following statements regarding capital structure is incorrect?

• A) Debt to equity or shareholders' interest ratios are both measures of capital structure.
• B) Capital structure ratios are an indicator of longer term viability and stability.
• C) A company with a higher equity ratio is less dependent on external funding.
• D) The capital ratios of companies, and industry groupings, are generally similar.

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