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What is the primary goal of optimizing the capital structure of a firm?
  • a)
    Maximizing interest payments
  • b)
    Achieving the lowest weighted average cost of capital
  • c)
    Increasing operational flexibility
  • d)
    Reducing equity ownership
Correct answer is option 'B'. Can you explain this answer?
Most Upvoted Answer
What is the primary goal of optimizing the capital structure of a firm...
The primary goal of optimizing the capital structure of a firm is to achieve the lowest weighted average cost of capital (WACC). This helps minimize the cost of financing while maintaining financial stability.
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What is the primary goal of optimizing the capital structure of a firm?a)Maximizing interest paymentsb)Achieving the lowest weighted average cost of capitalc)Increasing operational flexibilityd)Reducing equity ownershipCorrect answer is option 'B'. Can you explain this answer?
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