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    Financing a Business and Holding Stocks

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    What are the two primary ways for a company to finance its business? Which would you choose if you were forming a corporation and trying to raise funds and why?

    Your co-worker, Sam, tells you that he is going to purchase common stock in a new start-up company in hopes of seeing a big return on his investment. He tells you that he wouldn't consider preferred stock because there is a very slim possibility of any type of large return. Explain why you agree or disagree.

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    https://brainmass.com/business/accounting/financing-business-holding-stocks-522236

    Solution Preview

    The two primary ways to finance a company is through debt or stocks. It depends on the amount of debt my company already has and how quickly I need the money that will determine how I would raise funds. If my debt ...

    Solution Summary

    This solution explains some fundamental concepts related to business financing and stock investments.

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