Microeconomics › Section Q · Financial markets › Topic Q.1
How businesses raise financial capital
A firm that wants a new factory, a fleet of vans or a research lab usually has to pay for it long before it earns anything back. Where that money comes from, and what the firm promises in return, shapes who owns and controls the business.
In this topic
- Spending now, earning later
- Money for a firm with no track record
- Reinvesting profits
- Borrowing from a bank
- Issuing bonds
- Worked example: a bond issue
- Selling stock
- Who owns and who decides
- Why the source depends on information
- Worked example: borrow or sell shares?
- Common mistakes to avoid
- Key takeaways
This topic is part of Wuanberri Pro. Checking your access…