Which One of the Following Will Affect the Capital Structure

question 17

Multiple Choice

Which one of the following will affect the capital structure weights used to compute a firm's weighted average cost of capital?

• A)Decrease in the book value of a firm's equity
• B)Decrease in a firm's tax rate
• C)Increase in the market value of the firm's common stock
• D)Increase in the market risk premium
• E)Increase in the firm's beta

Explain the significance of the atomic structure in determining chemical properties and behaviors of elements.

Understand the concept of pH and its significance in solutions.

Identify and explain the properties and significance of atoms, including their mass and atomic number.

Distinguish between acids, bases, and buffers and their roles in chemical reactions.

---

Definitions:

Risk-Free Rate

The interest rate at which an investor can lend money with no risk of default, often represented by the yield on government bonds.

APT

The Arbitrage Pricing Theory is a model that predicts asset returns based on the relationship between an asset's return and several macroeconomic factors.

CAPM

The Capital Asset Pricing Model, a model that describes the relationship between systemic risk and expected return for assets, particularly stocks.

Risk-Return Relationship

The principle that potential return increases with an increase in risk, describing the trade-off between the desire for the lowest possible risk and the highest possible return.