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Distinguish between a firm's capital budgeting decision and financing decision?

~The decision about which assets to buy is termed the capital buygeting or inverstment decision. The cesision about how to raise money is the financing decision.


What are the basic financial decision in an organization?

The basic financial decisions include long term investment decisions, financing decisions and dividend decisions. Investment Decision relates to the selection of assets in which funds will be invested by a firm. These decisions are of two types Capital Budgeting Decisions and Working Capital Decisions. Financing Decision is broadly concerned with the asset-mix or the composition of the assets of a firm. The concern of the financing decision is with the financing-mix or capital structure or leverage. Dividend Policy Decision isrelated to the dividend policy.


What is financing provided by a firm's owner classified as?

Financing provided by a firm's owner is classified as owner’s equity or equity financing. This type of funding represents the owner's investment in the business and includes any profits reinvested back into the firm. It contrasts with debt financing, which involves borrowing funds that must be repaid. Owner’s equity reflects the residual interest in the assets of the company after deducting liabilities.


What are the two broad sources of financing for a firm?

The two broad sources of financing for a firm are equity financing and debt financing. Equity financing involves raising capital by selling shares of the company, which gives investors ownership stakes and potential dividends. Debt financing, on the other hand, involves borrowing funds, typically through loans or bonds, which must be repaid with interest over time. Each source has its advantages and disadvantages, impacting the firm's capital structure and financial strategy.


The most expensive source of financing for a firm is?

common stock holder equity

Related Questions

Distinguish between a firm's capital budgeting decision and financing decision?

~The decision about which assets to buy is termed the capital buygeting or inverstment decision. The cesision about how to raise money is the financing decision.


What are the basic financial decision in an organization?

The basic financial decisions include long term investment decisions, financing decisions and dividend decisions. Investment Decision relates to the selection of assets in which funds will be invested by a firm. These decisions are of two types Capital Budgeting Decisions and Working Capital Decisions. Financing Decision is broadly concerned with the asset-mix or the composition of the assets of a firm. The concern of the financing decision is with the financing-mix or capital structure or leverage. Dividend Policy Decision isrelated to the dividend policy.


A firm's opportunity costs of using resources provided by the firm's owners are called what?

equity financing


What is the definition of 'financial management'?

One of the three areas of the discipline of finance. It deals with the operation of the firm (both the investment decision and the financing decision) from the firm's point of view.ITs called financial mamagement or corporate finance


What is financing provided by a firm's owner classified as?

Financing provided by a firm's owner is classified as owner’s equity or equity financing. This type of funding represents the owner's investment in the business and includes any profits reinvested back into the firm. It contrasts with debt financing, which involves borrowing funds that must be repaid. Owner’s equity reflects the residual interest in the assets of the company after deducting liabilities.


What are the two broad sources of financing for a firm?

The two broad sources of financing for a firm are equity financing and debt financing. Equity financing involves raising capital by selling shares of the company, which gives investors ownership stakes and potential dividends. Debt financing, on the other hand, involves borrowing funds, typically through loans or bonds, which must be repaid with interest over time. Each source has its advantages and disadvantages, impacting the firm's capital structure and financial strategy.


What are the services for a firm provided by a leasing company?

Financial Products and Services Equipment Financing Receivables Financing Inventory Financing Finance Lease Operating Lease Money Market


Where would one find financing in Chicago?

The Chicago Tribune has help for financing or Robert Half has a financing and account website. His firm is one of the largest recruitment firms. Another option is to apply for a financing internship.


The most expensive source of financing for a firm is?

common stock holder equity


What are the channels through which financing choices can affect firm value?

dont knw.


What effect does leasing have on a firm's capital structure?

Leasing is a substitute for debt financing, so leasing increases a firm's financial leverage.


What are the three main decision areas in business finance?

The three main decision areas in business finance are:Investment decision,Financing decision and Dividend decision