The STRONGEST factor affecting a company's decision of whether or not to finance with bonds is ________.

Question

Quizplus · Accepted Answer

The interest rate is the most significant factor because it determines the cost of borrowing the funds through bonds. If the interest rate is low, a company is more likely to finance with bonds since it will be cheaper to borrow the funds. If the interest rate is high, a company may seek alternative financing options or delay borrowing until rates decrease.

The STRONGEST Factor Affecting a Company's Decision of Whether or Not