I read the following statement in my study guide:
Wrong decisions, such as using short-term debt to finance long-term projects just before interest rates rise, can be very costly.
Why would this be very costly? I interpret it as taking a loan with interest rate x, instead of interest rate y, where x < y to finance some project. Taking a loan with a lower interest rate seems better. Obviously, I'm misinterpreting this...so what's going on?