When Given a Choice, Businesses Prefer to Obtain Long-Term Financing

question 67

True/False

When given a choice, businesses prefer to obtain long-term financing through retained earnings or by borrowing from a lending institution such as a bank instead of issuing stock.

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Definitions:

Question Marks

Products or businesses that operate in high-growth markets but have low market share, often requiring significant investment to improve their position.

Market Share

The segment of a market held by a certain company or product.

Market Growth

An increase in the demand for a particular product or service over time, which can be influenced by factors like changes in consumer preference, population growth, and technological advancement.

BCG Matrix

A strategic business tool developed by the Boston Consulting Group that uses market growth rate and market share to evaluate the relative performance of products or business units.