How do financing, risk, and returns affect financial decisions?

"The principal is the amount borrowed by the issuer of a bond, also called par value. Retained earnings are profits that have been reinvested in a firm. Return is the opportunity for profit. A revolving credit agreement is a guaranteed line of credit whereby a bank agrees that a certain amount of funds will be available for a business to borrow over a given period, typically two to five years. Risk is the potential for loss or the chance that an investment will not achieve the expected level of return. The risk-return trade-off is a basic principle in finance holding that the higher the risk, the greater the return that is required. The secondary market is the securities market where old, already issued securities are bought and sold among investors; it includes broker markets, dealer markets, the over-the-counter market, and the commodities exchanges."