Question

The amount of debt, equity share capital, preference share capital are __________ by financial decisions, which is a part of financial management.

• A. affected
• B. not affected
• C. minutely affected
• D. largely affected

Answer 1

Answer: (A)

affected

The primary goal of both investment and financing decisions is to maximize shareholder value. Investment decisions revolve around how to best allocate capital to maximize their value. Financing decisions revolve around how to pay for investments and expenses. Companies can use existing capital, borrow, or sell equity.

The amount of debt, equity share capital, preference share capital are affected by financial decisions, which is a part of financial management.