Answer :

Final answer:

Buying on margin involves purchasing financial products with borrowed money, while firms have different options to finance capital expansion.


Explanation:

Buying on margin is the practice of purchasing financial products using borrowed money. This strategy allows individuals to leverage their money by borrowing funds to buy assets like stocks.

When a firm needs to expand its capital stock, it can finance the purchase through various means, such as selling stock, borrowing from a bank, or issuing bonds. Each option has its advantages and drawbacks in terms of financial obligations and control over operations.


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