Final answer:
Without access to stock markets, companies would have to rely on the bond market to raise long-term funds, as it allows companies to borrow money without sacrificing ownership or control over their operations.
Step-by-step explanation:
If companies cannot rely on stock markets to obtain funds, they will have to rely more heavily on the bond market to raise long-term funds. When a company issues bonds, they are borrowing money from investors with the promise to repay the principal with interest after a set period. Bonds provide a way for businesses to secure the capital needed for operations, expansions, or investments without giving up any ownership or control, as would be the case with issuing stocks.
Capital markets include both the stock market and bond market, where long-term securities like corporate and government bonds are traded. This is contrasted with money markets, which deal with short-term loans of less than one year. Thus, without access to stock markets, the focus shifts to the bond market for long-term financial capital.