Explain the trade-offs that firms must consider


Please answer the following question:

Question 1: Explain the trade-offs that firms must consider when they determine their target capital structure

Question 2: Explain the effects that debt financing has on the firm's risk and cost of capital

Question 3: Summarize capital structure theory

Question 4: Explain why firms in different industries have different capital structure.

Question 5: Explain why some investors like the firm to pay more dividends while other investors prefer reinvestment and the resulting capital gains.

Question 6: Discuss the various trade-offs that companies face when trying to establish their optimal dividend policy.

Question 7: Differentiate between stock splits and stock dividends.

Question 8: List the advantages and disadvantages of stock repurchases vis-à-vis dividends from both investor's and companies' perspectives.

Note: Please show basic calculation

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Accounting Basics: Explain the trade-offs that firms must consider
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