Final answer:
Moonworks is unlikely to use commercial paper for debt financing due to its size as a small firm, opting for bank loans instead.
Explanation:
Moonworks, being a relatively small firm, is unlikely to use commercial paper as a form of debt financing. Commercial paper is typically utilized by larger, well-known companies that can attract enough investors and market facilitators for this type of financing.
On the other hand, smaller firms like Moonworks may find it easier and more cost-effective to obtain bank loans rather than opt for commercial paper. Bank borrowing, which is more customized, can be beneficial for relatively small firms as banks can closely monitor their financial activities.
In essence, while commercial paper is suitable for larger and established companies, bank loans are a more common form of debt financing for smaller firms like Moonworks.
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