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A company needs to raise $2 million to build a new warehouse and is trying to decide whether to issue debt or equity to get
A company needs to raise $2 million to build a new warehouse and is trying to decide whether to issue debt or equity to get the money. Which of the following statements is true about that decision?
a. The possibility of bankruptcy is a disadvantage of equity.
b. The potential impact on future loans is a disadvantage of debt.
c. Financial leverage is an advantage of equity issuance.
d. Tax effects are a disadvantage of debt.
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