Financial managers can create value through financing decisions that:
A)reduce costs or increase subsidies.
B)increase the product prices.
C)create a new security.
D)Both A and B.
E)Both A and C.

Question

Quizplus · Accepted Answer

Financial managers can create value through financing decisions that reduce costs or increase subsidies (option A), such as negotiating lower interest rates on loans or obtaining tax breaks. They can also create value through financing decisions that create a new security (option C), such as issuing bonds or shares, which can increase the firm's capital and provide more financing options. Option B is not a viable financing decision for financial managers as it can decrease demand for the product and decrease overall revenue for the firm. Therefore, the best choice is E, as both options A and C are viable ways for financial managers to create value through financing decisions.

Financial Managers Can Create Value Through Financing Decisions That