What are the main objectives of financing decision? 1. To get optimal working capital figure. 2. To get optimal capital structure. 3. To make the company exposed to high risk. 4. To keep the cost of capital lowest. 5. To make the value of share highest.

The correct answer is D. 2, 4 and 5.

The main objectives of financing decision are to get optimal capital structure, keep the cost of capital lowest, and make the value of share highest.

• Optimal capital structure is the mix of debt and equity that minimizes the firm’s cost of capital.
• The cost of capital is the rate of return that a company must earn on its investments in order to satisfy its investors.
• The value of a share is the price at which a share of stock is currently trading on the stock market.

Option 1 is incorrect because working capital is not a financing decision. Working capital is the difference between a company’s current assets and its current liabilities. It is a measure of a company’s liquidity.

Option 3 is incorrect because making the company exposed to high risk is not a financing decision. The level of risk that a company takes is a strategic decision. It is determined by the company’s business model, its industry, and its competitive environment.

Option 5 is incorrect because making the value of share highest is not a financing decision. The value of a share is determined by the market, and it is influenced by a variety of factors, including the company’s financial performance, its growth prospects, and its risk profile.