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    Obtaining Capital in Today's Business Climate

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    "Obtaining Capital in Today's Business Climate"

    From the e-Activity, assess the short-term and long-term effects of the limited capital that is currently available, especially since banks are increasingly reluctant to make loans. Speculate on how long the capital shortfall may last and why.

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    Solution Preview

    Businesses today are definitely finding it harder to secure loans. This has been the trend since the last recession several years ago. During the last recession, such a high percentage of businesses defaulted on loans that many banks were forced to close. While defaults on business loans was not the sole reason many banks closed, it definitely contributed to their demise. From a short-term standpoint, it is exceedingly difficult for a company to finance short term operations and to obtain working capital due to the restrictions on obtaining ...

    Solution Summary

    This solution discusses capital shortfalls, how long a capital shortfall is likely to last, and why. Includes 2 references.