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The Capital’s Election Criteria Used in the Financial Management of a Company’s Financing Decision

Author

Listed:
  • Camelia OPREAN

    (University Lucian Blaga of Sibiu, Romania)

  • Constantin OPREAN

    (University Lucian Blaga of Sibiu, Romania)

Abstract

The optimization of the capital structures of a company after the cost criteria represents a profitable activity, provided that it is well conceived, organized and carried out. For this consideration, the capital’s structure and their medium cost is an important profit source for the company, so the profit comes from this source, and not from the exploitation activity or other financial sources or traditional exceptive. In conclusion, the cost of the capital has to be previewed; the company has to build an adequate strategy and tactical procedures to accomplish this challenge. Besides the capital’s cost, in this paper we present some other criteria that can interfere in the choice of the financing method, all depending on the financial situation of each company and on its strategy.

Suggested Citation

  • Camelia OPREAN & Constantin OPREAN, 2009. "The Capital’s Election Criteria Used in the Financial Management of a Company’s Financing Decision," REVISTA DE MANAGEMENT COMPARAT INTERNATIONAL/REVIEW OF INTERNATIONAL COMPARATIVE MANAGEMENT, Faculty of Management, Academy of Economic Studies, Bucharest, Romania, vol. 10(2), pages 229-242, May.
    • Handle: RePEc:rom:rmcimn:v:10:y:2009:i:2:p:229-242
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    File URL: https://www.rmci.ase.ro/no10vol2/Vol10_No2_Article3.pdf
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    More about this item

    Keywords

    cost; financial structure; shareholders’ equity; debt.;
    All these keywords.

    JEL classification:

    • P34 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - Finance
    • E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy

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