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Western Entertainment is considering issuing bonds to finance its business expansion. The company contacts you, a business consultant charging $200 per hour, to answer the

Western Entertainment is considering issuing bonds to finance its business expansion. The company contacts you, a business consultant charging $200 per hour, to answer the following questions.

  1. What are the advantages of issuing bonds over borrowing funds from a bank?
  2. What are the advantages of issuing bonds over issuing common stock?
  3. How is a bond price determined?

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