Which type of financing does it need?- Trade credit- Accounts receivable- Inventory-

Which type of financing does it need?

– Trade credit

– Accounts receivable

– Inventory

–

Bank loan

———

What is an advantage of short-term financing?

– Restrictive loan requirements

– Increased liquidity

– Multiyear repayment terms

– Lower interest rates

———

A company plans to expand into new sales territories and decides to obtain a long-term

loan.

What is an advantage of long-term financing?

– Lowers leverage by paying more interest

– Increases stockholder ownership

– The interest is tax deductible

– Creditors prefer companies with lower equity levels