Question

When a large, well-known corporation wishes to borrow directly from the public, it can

a. go to a bank for a loan.

b. sell bonds.

c. sell shares of stock.

d. all of the above are correct?

Answer 1

Answer: The correct answer is choice b.

Explanation: When a company is looking to borrow money from the public, the only correct answer is choice b, sell bonds.

Going to a bank for a loan is incorrect because this would be borrowing from a bank, not the public. Selling shares of stock is incorrect because the buyers would be buying ownership in the company, they would not be loaning the business money.

Answer 2

The correct answer is option B, Sell Bonds.

Step-by-step explanation:

When large well know corporations wishes to borrow directly from the public, it can sell bonds. People would happily invest their money by purchasing the bonds of the well established large corporation. People would invest and corporation would use that money as a way to borrow it.