Debt Financing definition explanation

What is Debt Financing?
When a firm raises money for working capital or capital expenditures by selling bonds, bills, or notes to individual and/or institutional investors. In return for lending the money, the individuals or institutions become creditors and receive a promise that the principal and interest on the debt will be repaid. Read more for examples and further explanation including related video clips and also comments

Example explains Debt Financing
The other way of raising capital is to issue shares of stock in a public offering. This is called equity financing.

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