Managers may be under pressure to ensure that the investment yield good results. A Board meeting was held to discuss the acquisition of controlling shares in another entity for the reason that it might boost income levels of the company:

Required 1. make commentaries on the advantages and disadvantages of using debt finance as a method of funding (12 marks) 2. state and explain the agency relationship between shareholders and management in companies and how it may result in the agency problem (6 marks) 3.state and make commentaries on the four types of decisions managers are requires to make in an organisation (4 marks) 4. Differentiate between systematic risks and unsystematic risks (6 marks)