Suppose That IBM Considers Expanding Its Operations

question 5

Essay

Suppose that IBM considers expanding its operations. The expansion will require $400 million for two new factories which the corporation plans to raise by selling stock and bonds. Which of the core principles will come into play as investors decide whether or not to buy the stock and the bonds?

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Definitions:

Usage Of Trade

Any practice or method of dealing having such regularity of observance in a place, vocation, or trade as to justify an expectation that it will be observed with respect to the transaction in question.

Commercial Practices

Activities, methods, and ethics involved in conducting business and trading of goods and services in the marketplace.

Oral Contract

An agreement between parties that is spoken and not memorialized in writing, yet is fully legal and binding.

Received and Accepted

A term indicating that goods or services have been both delivered and acknowledged as meeting the terms of a contract or agreement.