Write a recommendation of the financial decisions you propose for this company based on an analysis of its capital structure and capital budgeting techniques.

The purpose of this assignment is to analyze a firm’s capital structure and its impact on firm performance. Within the assignment, explain core concepts related to business risk and recommend sound financial decisions based on analysis of a firm’s capital structure and capital budgeting techniques.
Read the Chapter 15 Mini Case in Financial Management: Theory and Practice. Using complete sentences and academic vocabulary, please answer questions a and b.
Write a recommendation of the financial decisions you propose for this company based on an analysis of its capital structure and capital budgeting techniques. Explain why you chose this recommendation.
While APA style is not required for the body of this assignment, solid academic writing is expected, and documentation of sources should be presented using APA formatting guidelines, which can be found in the APA Style Guide, located in the Student Success Center.
This assignment uses a rubric. Please review the rubric prior to beginning the assignment to become familiar with the expectations for successful completion.
Using the free cash flow valuation model, show the only avenues by which capital structure can affect value.
(1)
What is business risk? What factors influence a firm’s business risk?
(2)
What is operating leverage, and how does it affect a firm’s business risk? Show the operating break-even point if a company has fixed costs of $200, a sales price of $15, and variable costs of $10.

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