What’s Capital Structure?
The capital structure of a company refers to the way it finances its operations and investments through a combination of debt and equity. It is a critical aspect of financial management that affects the company’s profitability, risk profile, and overall performance. Understanding the capital structure is essential for investors, creditors, and management to assess the financial health and potential growth prospects of a business. This article aims to explore the concept of capital structure, its components, and its implications for a company’s financial strategy.
In the next section, we will delve into the components that make up a company’s capital structure.
