Company needs financing. The CFO is proposing that her company issues debt rather than equity, because interest rates are low and thus debt is clearly cheaper than equity.

1) What do do you think of the reasoning behind the CFO’s idea (i.e., simply answer the question: is the CFO's reasoning right)?

2) Discuss why you think so.

Answer rating: 100% (QA)

1 Yes the reasoning of CFO is partially right as debt is usually cheaper th... View the full answer