In: Finance
Explain and critically evaluate main sources of finance that could be utilized by a company during any panademic time like COVID-19
Companies select its source of funds according to the cost of capital , availability of funds and terms and condition. Thus companies have many options to raise funds for the business needs.
During COVID-19 , but it is a different scenario in which business houses are facing ,it first time which is extraordinary and not expected by any business entity so there was no strategy with any business organization to cope up with , especially it was difficult time to raise the funds for business entity as we know most of the part in the world were locked down and income of public was already sharply declined businesses were closed and economy is facing worst time in the history.
Hence in this scenario of COVID-19 the main source of finance that could be utilized is retained earnings every business organization have Retained earnings and they can easily utilize this source of funds Easily. Therefore in such difficult time it is advisable for every business organization to use retained earnings as source of funds as in this difficult time it is easily available no legal formalities involves and it is also easy to use.
Companies select its source of funds according to the cost of capital , availability of funds and terms and condition. Thus companies have many options to raise funds for the business needs.