Can you give some specific examples of financial management decisions that organizations need to make?

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The first type of financial management decisions that a company needs to make is regarding capital Investments. A company would be faced with different choices regarding the investment options. A specific example is when a company is planning to start a new product and is faced with the choice of setting up a new plant or leasing the plant.

The second area of Financial Management is determination of the capital structure. A company can Finance its operations either with debt or with equity. It is up to the company to decide its optimal capital structure and how much debt to undertake. An example includes raising capital worth 1 million dollars by way of an equity issue.

A third example of a financial management decision is that in Working Capital Management. A company needs to decide Whether credit should be extended to a customer and what should be the terms and discount offered to the customer

jeff jeffy answered 1 year ago

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