Discuss pros and cons of debt financing in contrast

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Reference no: EM132280780

Answer the following Questions :

Q1) Discuss pros and cons of debt financing in contrast to equity financing in capital budgeting. What are the implications of each for shareholders' wealth maximization?

Q2) This discussion question is in preparation of CLA 2. Using Yahoo Finance, or any credible source identify 5 securities that had significant appreciation in value from year 2000 to 2018.

In evaluating appreciation, you need to incorporate effect of stock split.

- Then organize the data on the value at the end of each year,

- Stock splits through these years, and annual paid dividend for each security in an Excel file.

- Organize it in a way that data on securities are arranged adjacent in horizontal direction.

Then evaluate annual return for each year and for each security

- incorporating change in value;

- paid dividends, and effect of stock split.

No two submissions should be exactly the same, otherwise the later submission will be rejected in favor of the earlier submission.

Also, in initiation of your written CLA 2 state your portfolio formation problem, provide the data on the 5 securities, as mentioned above, and the criterion for choosing these securities.

Reference no: EM132280780

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