Minimising the cost of a company's financing activities also maximises the total value of the company.

Question

Quizplus · Accepted Answer

Minimizing the cost of financing activities such as debt and equity can increase the company's profitability and cash flow, leading to an increase in the overall value of the company. This is because lowering financing costs means that the company has access to cheaper capital which in turn benefits the company's financial performance, leading to higher stock prices and shareholder value.

Minimising the Cost of a Company's Financing Activities Also Maximises