Explain to Wanda how the monetary system works. In particular, describe the various financial institutions’options she has for raising capital for he business. Be certain to explain the advantages and potential disadvantages of each funding method. How could Wanda approach seeking funding for expansion?
Explain to Wanda how the monetary system works. In particular, describe the various financial institutions’options she has for raising capital for he business. Be certain to explain the advantages and potential disadvantages of each funding method. How could Wanda approach seeking funding for expansion?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Explain to Wanda how the monetary system works. In particular, describe the various financial institutions’options she has for raising capital for he business. Be certain to explain the advantages and potential disadvantages of each funding method. How could Wanda approach seeking funding for expansion?
Transcribed Image Text:### Scenario
Salty Pawz was established using Wanda’s personal funds since she initially sold her products only to friends and family and could pay for everything as she went along. Now that the business is growing, she knows she cannot finance the expansion out of her pocket, so she is considering taking out a loan. She has no experience with financial institutions other than the basics, such as managing her bank accounts, a credit card, a mortgage, and a car loan, all of which are with the local credit union.
### Your Task
Explain to Wanda how the monetary system works. In particular, describe the various financial institutions' options she has for raising capital for her business. Be certain to explain the advantages and potential disadvantages of each funding method. How could Wanda approach seeking funding for expansion?
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