Question: This is Financial Strategic Management subj. Please help me answer the following: Note: please select the best and appropriate answer then provide explanation of the

This is Financial Strategic Management subj. Please help me answer the following:

Note: please select the best and appropriate answer then provide explanation of the possible answers for me to understand thanks!

1. Company X is thriving and gaining so much profit amidst the disturbance of COVID-19. Due to its growth potentials, the Chairman of the Board decided to expand the company's operation. This plan needs capital outlay of PhP 1.0 billion pesos. Though the company has enough money to finance its expansion, all officers agree to finance their needs by issuing debt instruments. Suppose the management consulted you on this matter, what will you tell them?

A. It is better to avoid borrowing, simply use the company's savings

B.It is ideal to issue common stocks thru the stock market

C.It is good to sell preferred stocks

D.I will tell them to capitalized half of the dividends

2. The Board of Directors of Company A had a long quarrel whether to issue dividends or not. Those who opted for the release of dividends anchored their arguments on the rule of equity and justice. They claimed that since investors put their coffers in the company, they deserve to receive payoffs in the name of dividends. The opposition insisted that withholding the dividends accord benefits to the shareholders because their shares of stocks will increase thru the capitalized dividends. What option is correct?

A. All options are correct

B. None of the option is correct

C. Releasing of dividend is correct if the opportunity cost of withholding it is higher (perspective of management)

D. Withholding of dividend is correct if the guaranteed return of the newly capitalized dividend is much higher than its opportunity cost in the hands of the investors

3.Corporation C is a mutual fund company. For the past few months, the management was alarmed by the deterioration of the Philippine Capital Markets. In order to avoid greater losses, the management decided to hedge their funds in Fiji, a very stable economy yet the exchange rate of their currency vis a vis the Philippine peso is quite extreme wherein peso is quite dominant than Fiji's currency. Decide which of the choices is correct.

A. This is the best model of international diversification

B. This is to be considered a risk-spreading

C. The company opens its gate to greater risk

D.All of the above choices are correct

4. If the opportunity cost of borrowing is much higher than the cost of using one's savings, then...

A. It is better to finance the business thru borrowing

B. Finance the business thru issuance of common shares

C. Finance the business thru the issuance of preferred shares

D. Finance the business thru the company's own savings

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