The True Cost Of Debt
Most small and emerging businesses use debt as part of their financing structure. (The exceptions–and they have dwindled–are those high-potential ventures that can raise money through promises of potentially lucrative slices of equity.) The question: How much does that money cost?
The financial crisis is proof that too few people either 1) know how to perform these calculations or 2) bother to live by what the numbers are telling them. The first part is somewhat easily remedied; the second, sadly, is perhaps something only a painful recession can drive home.
This article originally appeared on Forbes.com.