What is the meaning of capital structure and what is the meaning of capital structure

Capital structure. Refers to long-term liabilities and.

Rights. Ordinary shares.

Special Unit. Retain surpluses.

distribution.

Optimal capital structure.

It's to make. Shareholder wealth.

Maximum or. Shares.

The largest capital structure, even for companies.

Cost of capital. Minimal capital structure. Capital structure refers to the value composition of various types of capital of an enterprise and its value.

Proportion. Corporate Finance.

Structure, or capital structure, reflects:

Corporate debt. And.

Equity. The proportions of the relationship, it is very large.

Extent. It determines the repayment and re-payment of the company's debts.

Financing capacity. Determines the enterprise. Future. Target.

Profitability. It is an important part of the financial status of the enterprise.

Index. Rational.

Financing structure. Can be lowered.

Financing costs. Exert.

Financial leverage. The regulating effect of the enterprise to obtain greater.

Own funds. Yield.

The significance of capital structure is the value composition and proportional relationship of various capitals of an enterprise, which is the result of the financing combination of an enterprise in a certain period. Capital structure refers to the value composition and proportional relationship of various capitals of an enterprise, which is the result of the financing portfolio of an enterprise in a certain period.

Capital structure refers to the composition and proportional relationship of various types of capital in the total capital of an enterprise. The broad capital structure includes the ratio of total debt to shareholders' equity, while the narrow capital structure refers to the ratio of long-term debt to shareholders' equity. Under a narrow capital structure, short-term debt is managed as working capital.

The pure capital structure of capital refers to the value composition and proportional relationship of various capitals of an enterprise, which is the result of the financing combination of an enterprise in a certain period. Capital structure in a broad sense refers to the composition of all capital of an enterprise and its proportional relationship. The capital of an enterprise for a certain period of time can be divided into debt capital and equity capital, and can also be divided into short-term capital and long-term capital.

Capital structure in a narrow sense refers to the composition and proportion of various long-term capital of an enterprise, especially the composition and proportion relationship between long-term debt capital and (long-term) equity capital. The optimal capital structure is the capital structure that maximizes the wealth of shareholders or the largest stock price, and the capital structure that minimizes the cost of capital even if the company is in the middle of the roll.

Capital structure refers to the value composition and proportional relationship of various capitals of an enterprise, which is the result of the financing portfolio of an enterprise in a certain period.

Capital structure refers to the value composition and proportion of various types of capital of an enterprise. The financing structure of an enterprise, or capital structure, reflects the proportional relationship between debt and equity of an enterprise, which largely determines the debt repayment and refinancing ability of the enterprise, determines the future profitability of the enterprise, and is an important indicator of the financial status of the enterprise.

A reasonable financing structure can reduce financing costs, give full play to the regulating role of financial leverage, and enable enterprises to obtain a greater rate of return on their own funds. Capital structure refers to the proportional relationship between equity capital and debt capital, which reflects the financial relationship of enterprises under the conditions of market economy, that is, the interest relationship between shareholders, bondholders and operators with capital and credit as the link, and through investment and lending.

Theoretical development

Capital structure theory is one of the important components of financial theory in Western countries. The capital structure theory has gone through two stages: the old capital structure theory and the new capital structure theory. The old capital structure theory was based on a series of rigorous assumptions, including traditional theory, MM theory, and trade-off theory.

The main research results include the conclusion that under ideal conditions, the MM theory concludes that the capital structure is independent of the value of the firm; In the presence of corporate income tax, the MM theory concludes that the value of the company increases with the increase of liabilities. Under the condition of bankruptcy costs, the trade-off theory concludes that to maximize the value of the company, it is necessary to weigh the benefits of tax avoidance and the cost of bankruptcy.

Capital structure refers to the composition of various types of capital of an enterprise and its chaotic proportional relationship, which is the result of the financing combination of an enterprise in a certain period. The factors affecting the capital structure are the stability and growth of the company's operating conditions; the financial status and credit rating of the business; the asset structure of the enterprise; the risk attitudes of corporate investors and management; industry characteristics; the reputation of enterprise development; Tax policy and monetary policy.