So, according to pecking-order theory, its best course of action is obvious: run down this balance before even considering any other measure.
This apparent conflict between theory and practice disappears once pecking-order theory is stripped back to its key underlying concept: use the cheapest funding source first.
So the key idea in pecking-order theory go for the cheapest source of cash first--is at the root of Apple's actions, even though the theory's usual sequence of funding sources hasn't been followed.
It seemed that a more expensive cash source than necessary was being accessed, contradicting not only the sequence but also the key underlying concept of pecking-order theory.
If it does turn out to be a case of cost overestimation, then managers have tried to use the key idea of pecking-order theory, but on the basis of an incorrect view of relative costs.