Question

Which of the following best describes how strategy is tied to the business function of Finance?

A Strategy determines what to measure to highlight business health.
B Strategy influences decisions around capital structure and debt.
C Strategy ensures proper data is mined and analyzed.
D Strategy ensures all actions and tactics are aligned to company goals.

Answer 1

Strategy in finance influences decisions around capital structure and debt, helping companies allocate financial capital to support their business objectives. Therefore, the correct option is B.

Step-by-step explanation:

The best description of how strategy is tied to the business function of Finance is option B: Strategy influences decisions around capital structure and debt.

Strategy in finance refers to the long-term plans and goals of a company, and it includes decisions related to capital structure and debt. By formulating and implementing a financial strategy, the company determines how to raise and allocate financial capital to support its business objectives. This involves deciding on the appropriate mix of debt and equity financing, as well as assessing the risk and return associated with different sources of capital.