Answered: Explain how a firm that expects to need…

Business

Finance

Explain how a firm that expects to need funds in the upcoming year might make sure the needed funds are available

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter16: Working Capital Policy And Short-term Financing

Section: Chapter Questions

Problem 23QTD

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Question

1. Explain how a firm that expects to need funds in the upcoming year might make sure the needed funds are available.

2. How does the uncertain nature of a firms sales due to Covid-19 influence its decision regarding the amount of short-term credit to use in its financing strategy?

3. What kinds of firms use commercial paper? Could the grocery shop in neighborhood borrow using this kind of credit?

4. From the standpoint of a borrower, is long-term or short-term credit riskier? Explain.

5. From the standpoint of an investor, is equity or debt riskier? Explain.

6. Give a report(one paragraph) of any company (either local or international) that using venture capital as a source of financing.

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Q1: Explain how a firm that expects to need funds during the coming year might make sure the needed funds will be available. Q2: How does the uncertain nature of a firm’s sales due to COVID-19 influence its decision regarding the amount of short-term credit to use in its financing strategy? Q3: What kinds of firms use commercial paper? Could the grocery shop in your neighbourhood borrow using this form of credit? Q4: From the standpoint of a borrower, is long-term or short-term credit riskier? Explain. Q5: From the standpoint of an Investor, is equity or debt riskier? Explain. Q6: Give a report (one paragraph) of any company (either local or international) that used venture capital as a source of financing. *
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