ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -What is equity financing? Equity financing is when a business raises funds by selling company stocks. These can take the form of common shares or preferred shares. In doing so, you’re essentially selling off little pieces of your company to investors to raise capital.

Detailed explanation-2: -There are two methods of equity financing: the private placement of stock with investors and public stock offerings. Equity financing differs from debt financing: the first involves selling a portion of equity in a company while the latter involves borrowing money.

Detailed explanation-3: -Individual investors, venture capitalists, angel investors, and IPOs are all different forms of equity financing, each with its own characteristics and requirements.

Detailed explanation-4: -That’s why you should spread your investments equally across four types of mutual funds: growth and income, growth, aggressive growth, and international.