Discuss pros and cons of using debt financing versus equity financing. Support your answer with real world example: find an example of financing (either debt, equity or both) and describe purpose of this financing done and some terms of it. If terms are not listed - provide theoretical framework of possible reasons why a given company pursued type of financing you described above. Note, this example should be no more than 1 year old.

Also, discuss whether or not, all else equal, firms with relatively volatile sales are able to carry relatively high debt ratios.  Provide an example of a company with relatively volatile sales, briefly discuss its debt usage.

Answer rating: 100% (QA)

Debt financing and equity financing are two common ways that firms raise capital Debt financing involves borrowing funds from lenders who expect to be paid back typically with interest Equity financin... View the full answer