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Compare and contrast the various options available to a business that is seeking to raise further debt capital.
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- 7.) Describe the debt and equity markets? How do organizations obtain financing from each market? What are the costs involved with obtaining financing in each market? What are some considerations a entity might consider before choosing which market to raise capital?discuss the main two long - term sources of financing available for companies; debt financing and equity financing. Discuss the advantages and disadvantages of each financing option.A company may choose to finance its operations or certain projectts by the means of either debt or equity. explain the diffetence between these two methods and give at least two examples of each.
- how can a company can raise capital through the issuance of equities?Include the advantages and disadvantages of the methodology.Indicate whether the following statement is true or false. Provide the relevant explanations. The higher the proportion of equity in a company’s overall capital structure, the higher return required by its debtholders. (Explain your reasoning – in your explanation, provide a numerical example supporting your answer.)While determining which companies will receive capital, what information do investors and creditors needs?
- To your understanding, Differentiate between debt-intensive and equity-intensive capital structure.Following the agency theory of capital structure, discuss how debt financing can be used as a mechanism to deal with the agency problem.Why is a financial structure of a capitalization structure (a mix of equity and debt finance) being preferred in financing businesses?
- Which of the following is a working capital management issue? O A. The choice of which long-term assets to purchase to meet the firm's business goals. O B. The appropriate amount of cash to hold. C. None of the above is a working capital management issue. O D. The proper mix of stocks and bonds to issue for financing assets.All of the following are sustainable methods businesses can use to raise capital (funding) except for________.A. borrowing from lendersB. selling ownership sharesC. profitable operationsD. tax refundsHow does a semi-strong market affect a company’s capital structure? Discuss the possible exposures and impact. Provide examples to justify your reasoning.