Economics Homework Help

The Saudi Arabia Vision 2030 stated SMEs (Small-Medium Size Enterprises) struggles to access adequate funding from the financial institutions. Offer two recommendations specific to how this struggle should be effectively addressed and be in alignment with Saudi Vision 2030.These post replies need to be substantial and constructive in nature. They should add to the content of the post and evaluate/analyze that post answer. Normal course dialogue doesn’t fulfill these two peer replies but is expected throughout the course. Answering all course questions is also required.

—–This week’s Discussion Question asks you to discuss the important questions financial managers should ask:

• What level of assets are needed to operate?
• How to finance those assets or raise capital? (The firm can use equity or debt financing or combination of both.)

Select a publicly traded company (make sure your selected company is different from your classmates’) based in the KSA and look (in terms of percentage) at how it finances its operations using equity or debt financing.

You are required to reply to at least two peer discussion question post answers to this weekly discussion question and/or your instructor’s response to your posting. These post replies need to be substantial and constructive in nature. They should add to the content of the post and evaluate/analyze that post’s answer. Normal course dialogue doesn’t fulfill these two peer replies but is expected throughout the course. Answering all course questions is also required.

There is also a Live Session this week.

Finance Principles for this module

• Principle 3: Risk Requires a Reward—We don’t take additional risk unless we are compensated with additional return.
• Principle 5: Conflicts of Interest Cause Agency Problems—Conflicts of interest between owners and managers can create challenges for optimal efficiency and value creation in organizations.

Learning Outcomes

1. Identify business and financial risk and their measurement.
2. Discuss the relationship between operating, financial, and combined leverage.
3. Recognize the concept of an optimal capital structure.
4. Calculate break-even points.
5. Use the basic tools of capital structure management.

Readings

Required:

Chapter 12 in Foundations of Finance – Determining the Financing Mix

Hamrouni, A., Boussaada, R., & Toumi, N. B. (2019). Corporate social responsibility disclosure and debt financing. Journal of Applied Accounting Research, 20(4), 394-415. https://doi.org/10.1108/JAAR-01-2018-0020

Li, Z., Li, Q., & Zeng, Y. (2020). Contraction flexibility, operating leverage, and financial leverage. Journal of Management Science and Engineering. https://doi.org/10.1016/j.jmse.2020.02.002

Recommended:

Chapter 12 PowerPoint slides SEU_FIN500_PPT_Mod07_Ch12.pptx – التنسيقات البديلة in Foundations of Finance – Determining the Financing Mix

Yan, C., & Huang, K. X. D. (2020). Financial cycle and business cycle: An empirical analysis based on the data from the U.S. Economic Modelling. https://doi.org/10.1016/j.econmod.2020.01.018