Which of the following is not a feature of an optimal capital structure?
A. Safety
B. Flexibility
C. Control
D. Solvency
Answer: Option C
Solution (By Examveda Team)
An optimal capital structure is the best combination of debt and equity financing that maximizes a company's market value and minimizes its overall cost of capital.Safety is a feature because a sound capital structure ensures the company can meet its obligations and reduces the risk of financial distress.
Flexibility is important as it allows the firm to adapt its financing strategy in response to changing market conditions or business needs.
Solvency is essential because a company must be able to meet its long-term financial commitments to remain financially healthy.
Control, however, is not a defining feature of an optimal capital structure. While management may prefer to retain control, the primary objective is value maximization, even if it results in some dilution of control.
Hence, the correct answer is Option C: Control.
This Question Belongs to Commerce >> Financial Management
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Investment is the _______________.
A. net additions made to the nation’s capital stocks
B. person’s commitment to buy a flat or house
C. employment of funds on assets to earn returns
D. employment of funds on goods and services that are used in production process
Financial Management is mainly concerned with ______________.
A. All aspects of acquiring and utilizing financial resources for firms activities
B. Arrangement of funds
C. Efficient Management of every business
D. Profit maximization
The primary goal of the financial management is ____________.
A. to maximize the return
B. to minimize the risk
C. to maximize the wealth of owners
D. to maximize profit
In his traditional role the finance manager is responsible for ___________.
A. proper utilisation of funds
B. arrangement of financial resources
C. acquiring capital assets of the organization
D. efficient management of capital
A is right answer please correct
A is right answer