ECONOMICS
SAVING AND INVESTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Borrowing funds from a creditor with the condition of repaying the borrowed funds plus interest
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Trading a portion of the ownership of the business for a financial investment in the business
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Acquiring large, more expensive loans which do not pay interest
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Specifying the amount and time of the disbursements and payment of the loan
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Detailed explanation-1: -Equity financing is when you raise money by selling shares in your business, either to your existing shareholders or to a new investor. This doesn’t mean you must surrender control of your business, as your investor can take a minority stake.
Detailed explanation-2: -Equity financing is the process of raising capital through the sale of shares. Companies raise money because they might have a short-term need to pay bills or need funds for a long-term project that promotes growth. By selling shares, a business effectively sells ownership in its company in return for cash.
Detailed explanation-3: -Equity financing refers to the sale of company shares in order to raise capital. Investors who purchase the shares are also purchasing ownership rights to the company. Equity financing can refer to the sale of all equity instruments, such as common stock, preferred shares, share warrants, etc.
Detailed explanation-4: -Equity crowdfunding is similar to crowdfunding (where money is raised by a number of individuals to fund a project or business). However, equity crowdfunding donors become investors by getting a small share in your business in return for their investment.