No mark scheme was provided for me to look at, and I have no idea on how to attempt it. Just bullet points will be fine, unless you're willing to write a model answer haha. Thanks!

2. Suppose a firm Delta technologies is usually keeping the payout ratio at 10%, while another firm Yummy Food's payout ratio is kept at 80%. Both firms enjoy a healthy return on equity of 20% constantly. Assuming that the predictions of the pecking order theory hold, answer the following questions. a) Which firm is supposed to have more investments? Explain why by discussing the possible roles of informational asymmetry. [20 marks] b) If Delta decides to make an unusually large investment, how would it finance the investment? What about Yummy if they also decide to make an unusually large investment? Do the different payout ratios matter? Explain. [20 marks] [Total 40 marks]