The assignment discusses the advantages of debt financing over equity financing for a company in the oil exploration industry. The benefits of debt financing include increased cash flows, improvement in credit rating, and retention of business ownership. Debt financing also allows the company to take advantage of lower interest rates and reduce tax liabilities. Additionally, the company can raise capital more easily through debt financing, which is simpler than equity financing. However, it is important to consider the potential disadvantages of debt financing, such as interference in decision-making and impact on the company's strategy.