Capital structure refers to the combination of debt and equity that a company uses to finance its overall operations and growth. Debt typically includes bonds or loans, while equity involves issuing stocks. The management’s goal is to optimize the capital structure in such a way that it maximizes company value by minimizing the cost of capital and increasing profitability.
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Jenna Lofton, MBA is a stock trading and investment expert with over a decade of experience in the financial industry. She began her career as a financial advisor on Wall Street and now helps everyday investors make smarter financial decisions through StockHitter.com.
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