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Your firm needed additional financing to expand the business. The firm reported net income in the last two years of business, but reported negative cash

Your firm needed additional financing to expand the business. The firm reported net income in the last two years of business, but reported negative cash flows from operating activities on its two most recent statements of cash flows. The firms balance sheet reported substantially more liabilities than shareholders equity. You ask your finance manager whether the firm should sell stock or borrow from its bank in order to secure financing for the business expansion. What would your finance manager say?

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