Long-Term Financing

Financial leverage is a technique used to multiply gains and losses by obtaining funds through debt instead of equity.

Debt is a way for firms to access capital for operations or investment with various terms and agreements for future repayment .

Companies can use equity financing to raise money and/or increase shareholder liquidity (through an IPO).

Three common examples of long term loans are government debt, mortgages, and debentures (bonds).

A corporate bond is issued by a corporation seeking to raise money in order to expand its business.