A company needing additional capital can either borrow it, or convince stockholders to invest more. (There is also the third option of using money already accumulated, but this possibility sort of voids the premise of "a company needing additional capital".) Please respond to these questions:
a. List the various advantages and disadvantages of issuing stock or long-term debt, such as bonds.
b. If you were helping manage a company that was in the market for more capital, which of these two basic options would you recommend?
c. What argument for one option versus the other would you present to your fellow board members?
d. If your choice was to issue preferred stock, and you anticipated a low demand for this type of security, what enhancements (features) would you include to make your company's preferred stock a more favorable investment?
e. If your choice was to issue long-term debt (bonds), and you anticipated a low demand for this type of security, what enhancements (features) would you include to make your company's bonds a more favorable investment?