Question

Capital structure decisions include all of the following EXCEPT: Deciding how to pay for long term projects. Deciding the mix of debt and equity for the firm. Deciding the total amount of debt the firm should take on. Deciding what assets to purchase.

Answer 1

Answer: the one that is not a capital structure decision is deciding what assets to purchase.

Explanation: The capital structure is how a firm finances its overall operations and growth by using different sources of funds. Debt comes in the form of bond issues or long-term notes payable, while equity is classified as common stock, preferred stock or retained earnings.

Answer 2

Hello there!

Your question asks which of the statements does not occur when making a capital structure decision.

Answer: Deciding what assets to purchase

The reason why "Deciding what assets to purchase" is the correct answer because this is something that someone can't make an decision on when making capital structure decisions.

Capital structure is a way a business/company/corporation finances their assets with debt, equity, or securities that they have.

The capital structure would be depended on their liabilities.

All in all Capital structure is the financial calculations of a business/company's debt, equity, and securities. They can't make a decision on what assets to purchase, due to the fact that they're financing what they already have, without any decision on what assets they should get.

I hope this helps!

Best regards,

MasterInvestor