Sometimes Small Businesses Have to Use Debt Financing Instead of Equity

question 105

Multiple Choice

Sometimes small businesses have to use debt financing instead of equity financing.When they do,they discover that:

• A)banks give them a lower interest rate because of their closeness to the customer and better management practices.
• B)finance companies are their primary source for debt funding.
• C)the cost of debt financing is often less than the cost of equity financing.
• D)there are fewer lenders than investors in the marketplace,but the money is easier to get from lenders.

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