You are the CEO of a mid-sized corporation and are looking to expand operations into the Eastern Atlantic States. This expansion would be completed in phases. Phase one requires the purchase of three warehouses in Tree Hill, South Carolina. You are considering how to finance this purchase.

1. What are your options?

2. How will each option affect your balance sheet?

3. How will each option affect your return on equity?

4. If you finance completely through debt what might happen to the risk of your corporation from a bank’s perspective?