Business Ch. 22 - Business finance: needs and sources

The finance department is responsible for

• forecasting cash flows

• producing the goods and services

• designing the marketing mix

• designing new products

A sole trader is likely to use ______ as the source of finance for expanding the business.

• share capital

• an overdraft

• a bank loan

• trade credit

A private limited company is likely to use _____ as the sources of finance when additional working capital is needed.

• an overdraft

• leasing

• microfinance

• hire purchase

Crowdfunding raises finance for new start-up businesses by encouraging a large number of people to each invest _____ amounts of money

• large

• small

• greater

• less

A bank manager is likely to want to see a ______ before agreeing to give a loan to a company

• map of the location

• partnership agreement

• CV of the owners

• cash flow forecast

A business needs finance when starting up a business, expanding an existing business or additional working capital

• True

• False

A bank loan is a source of internal finance.

• True

• False

A new business would not use the sale of existing assets to raise finance

• True

• False

Micro-finance is often used as a source of finance in developed countries.

• True

• False

Overdrafts are a good source of finance to purchase new machinery.

• True

• False