Comment by asdf88990
3 hours ago
No, because if the company loses money you lose too.
With Usury/Debt you pay for lending money and you pay whatever the enterprise makes money or not.
3 hours ago
No, because if the company loses money you lose too.
With Usury/Debt you pay for lending money and you pay whatever the enterprise makes money or not.
Debt is generally cheaper because lenders face lower risk. Because debtors hold priority claims on assets during liquidation and receive guaranteed fixed payments, they demand lower returns. In contrast, equity investors require higher returns for taking on higher risks.
Companies also often prefer debt because it doesn't dilute shareholders which issuing new shares would do.