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For the purposes of the financial deficit financing, all organizations looking for the best combination of their capital financing cost, this combination called Capital structure which is composed from internal and external resources such as common stock (Equity) , preffered shares and bank loans. WACC is a tool of making financial decison to obtain perfect percentage of capital cost, which is should be less than the required rate of returns (RRR).
So the relationship between Capital structure and WACC is that, through WACC percent (%) you can define the weight of internal and external resources of the capital structure.
