Financial markets facilitate the transfer of excess funds from those who have them to those who need them.

In the following table, determine whether each financial market participant is a surplus unit or deficit unit.

Financial Market Participant

Surplus Unit

Deficit Unit

A firm that issues equity securities to expand operations

A state that is constantly running a budget deficit

A bank that lends money at a rate faster than it borrows it

A firm that purchases debt securities

Suppose Titanium Unlimited needs to raise money to finance its new manufacturing facility, but their CFO does not want to part with any of the firm$$s equity. In this case, Titanium Unlimited would likely issue securities to obtain the funding.

Which of the following are ways that Titanium Unlimited could obtain funds to finance the expansion of its operations, given its stated preference in the previous question? Check all that apply.

Issue common stocks

Issue preferred stocks

Issue corporate bonds

Issue commercial paper