What are the theories of capital structure?
Answer: There are four important capital structure theories: net income theory, net operating income theory, traditional theory, and Modigliani-Miller theory.
What are the 4 types of capital structure?
Capital structure relates to how much money—or capital—is supporting a business, financing its assets, and funding its operations. It can also show company acquisitions and capital expenditures that can influence the business's bottom line.
What is capital structure capital structure theory and its importance?
Capital structure theory is the analysis of this key business question. The net income approach, static trade-off theory, and the pecking order theory are three financial principles that help a company choose its capital structure.