You are working for a financial advisory company. In a team meeting, one of your coworkers made the following statements:

1. whenever possible, firms should exploit external funds first, then consider internal funds

2. firms should not use forward contract as a tool to stabilize cashflow

a) only statement 1 is correct

b) only statement 2 is correct (this is NOT the answer)

c) both statements are correct

d) both statements are incorrect