A corporation is looking to take advantage of market conditions and begin expanding as soon as possible. To do so, the company requires cash to purchase new buildings, machinery, and other capital goods. What should the directors keep in mind as they consider the type of funding to pursue?(1 point)

Question

Responses

Banks will likely offer disappointingly low interest rates.
Banks will likely offer disappointingly low interest rates.

Changes in the stock market.
Changes in the stock market.

Involving a bank will likely make borrowing more expensive.
Involving a bank will likely make borrowing more expensive.

The types of saving accounts a bank offers.

Answer 1

As the corporation considers its options for funding, the directors should primarily keep in mind the potential impact of the changes in the stock market. Market conditions can influence the cost of capital, investor sentiment, and the availability of alternative financing options. Understanding these factors will allow the corporation to make informed decisions about whether to pursue debt financing, equity financing, or other funding avenues.

Other considerations, like interest rates from banks and the costs of borrowing, also matter, but the stock market dynamics are crucial for long-term planning and strategic expansion.

Therefore, the most relevant point in this context is Changes in the stock market.