What type of financing would you recommend

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Reference no: EM132802357

Problem - LA Basin Utility, Inc, operates in the utility industry which is highly regulated by the state. This means that the company has to apply to a state commission any time the company wants to change its rates. Usually, the commission allows LA Basin to set its rates to cover all of its necessary expenses. They also have to complete long term planning concerning the number of energy generating plants necessary to serve the expanding population in Los Angeles.

a. If you are the CFO of LA Basin Utility, Inc. in charge of financing the company, what type of financing would you recommend that LA Basin use to get capital to build the next power plant? Why would you choose that type of financing?

b. What are the advantages and disadvantages to the financing source you have chosen?

Reference no: EM132802357

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