Identify the internal factor that influences the stock price of a firm.
A)Legal constraints
B)Capital structure
C)Tax laws
D)General level of economic activity
E)Conditions in the stock market

Question

Identify the internal factor that influences the stock price of a firm. 
A)Legal constraints
B)Capital structure
C)Tax laws
D)General level of economic activity
E)Conditions in the stock market

Quizplus · Accepted Answer

Capital structure, which refers to the way a company finances its operations and investments through a mix of equity and debt, can have a significant impact on the stock price. A company with a high level of debt may be viewed as riskier and may have a lower stock price, while a company with a strong equity position may be viewed as more stable and have a higher stock price. Therefore, the capital structure of a company is an internal factor that can influence its stock price.

Identify the Internal Factor That Influences the Stock Price of a Firm