Read the passage given below and answer question.

Khanna Ltd. is a company engaged in production and trade of "Phulkari" work of Punjab. Its products are in great demand overseas. The company plans to open one more unit for manufacturing Phulkari products. For this purpose, it requires additional investment of Rs 10 crores. It involves committing the finance on a long term basis. The Finance Manager of the company has suggested issue of debentures at an estimated cost of 8%. The EBIT of the company was Rs 6,00,000 and total capital invested was Rs. 1,00,00,000. The company can also opt for issuing equity shares as an alternative to debt financing. A judicious mix of both sources - Debt and Equity would increase the EPS. 

"The Finance Manager of the company has suggested issue of debentures at an estimated cost of 8%".

The above statement conveys _________ type of financial decision

Financing decision

The correct answer is Option (3) → Financing decision

The statement "The Finance Manager of the company has suggested the issue of debentures at an estimated cost of 8%" conveys a Financing Decision. The decision is related to how the company plans to raise funds for its investment in the new unit, and in this case, it involves the issuance of debentures as a method of financing.