Question

Would it be wise for a young company that is growing quickly but still hasn’t achieved profitability to attempt to issue bonds as a way to expand its working capital?

Answer 1

It would not be wise for the young company to attempt to issue a bond as a way of expanding its capital. This is because, the company still has to be able to find a balance between its expenditure and income before it can think towards expansion. If this is not met, they might run into series of financial debts while trying to expand.

Step-by-step explanation: