Capital structure measures a company's ability to earn net income from sales.

Name: Capital structure measures a company's ability to earn net income from sales.
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Question

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Capital structure refers to the way a company finances its operations through a combination of debt and equity. It does not directly measure a company's ability to earn net income from sales, although it can impact profitability through factors such as interest expense and the cost of capital.

Capital Structure Measures a Company's Ability to Earn Net Income