YOUR CHOICE. THANK YOU. Chapter One (Introduction to Corporate Finance) The three major methods for raising capital in an organization are selling stock, borrowing and what? 1. -A. Selling Bonds B. C. D. Seeking grants from the federal government Credit Default Swaps Producing an operating profit 2. The three methods of raising capital fit into one of two general captions; debt financing or equity financing. The decision as to how to deploy that capital (debt or equity or a combination thereof) is referred to as the: A. The investment decision B. The capital structure decision C. The Dred Scott decision D. The working capital decision 3. Which of the following are DISADVANTAGES of forming a corporation? (circle all that apply) A. Cost of legal and governance compliance. B. Double taxation C. Limited liability Separation of ownership and control E. D. Ease of raising capital 4. The number one goal of a corporation should be to: A. Always have enough capital and thereby eliminate the need to borrow B. Be as conservative as possible with the use of stockholder funds C. Manipulate the accounting results to reflect ever increasing profitability D. Increase shareholder wealth