Factors Affecting Capital Structure Decisions

  • [a] Factors that affect capital structure decisions
  • [d] Calculate target capital structure weights. Use target capital structure to estimate WACC.

Terms covered: Agency costs of equity, Asymmetric information, Pecking order theory

Why is the language of the Learning Outcome Statements (LOS) different from the curriculum?
The LOS are protected under the CFA Institute's copyright, and we don't have permission to duplicate them verbatim. Therefore, we've rephrased the LOS and included alphabetical labels (a, b, c, …) to simplify cross-referencing with the original LOS in the curriculum when needed.

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