ENTREPRENEURSHIP

Detailed explanation-1: -Definition: When a company borrows money to be paid back at a future date with interest it is known as debt financing. It could be in the form of a secured as well as an unsecured loan. A firm takes up a loan to either finance a working capital or an acquisition.

Detailed explanation-2: -Debt financing is the opposite of equity financing, which entails issuing stock to raise money. Debt financing occurs when a firm sells fixed income products, such as bonds, bills, or notes. Unlike equity financing where the lenders receive stock, debt financing must be paid back.

Detailed explanation-3: -Debt financing occurs when a company raises money by selling debt instruments, most commonly in the form of bank loans or bonds. Such a type of financing is often referred to as financial leverage.

Detailed explanation-4: -Equity refers to raising capital through the sale of company shares, whereas debt financing is the generation of capital by loaning funds that are then paid back with interest over a period of time.