Which term is used to describe the mix of equity and debt financing a firm uses to meet long-term financing needs?
A)capital spectrum
B)capital ratio
C)capital budget
D)capital structure

Question

Quizplus · Accepted Answer

Capital structure refers to the mix of equity and debt financing that a firm uses to meet its long-term financing needs. The specific combination of equity and debt financing that a firm chooses can have a significant impact on its cost of capital, financial risk, and ultimately its overall value.

Which Term Is Used to Describe the Mix of Equity