3.Sources of Finance

Which source of finance involves borrowing money for a specific period, usually with interest, and is typically used for long-term investments?

• Equity Financing

• Trade Credit

• Debt Financing

• Grants and Subsidies

What type of financing is characterized by selling a portion of the ownership of the company in exchange for capital, usually to a successful business person.

• Retained Earnings

• Venture Capital

• Debt Financing

• Trade Credit

If a business obtains funds by selling goods on credit and paying for them later, it is using:

• Debt Financing

• Trade Credit

• Equity Financing

• Leasing

Which source of finance does not require repayment but is usually given to support specific activities or projects?

• Grants and Subsidies

• Bank Loan

• Trade Credit

• Equity Financing

What is the primary source of finance for a sole proprietorship?

• Equity Financing

• Retained Earnings

• Personal Savings

• Bank Loan

When a company reinvests its profits back into the business, it is using:

• Debt Financing

• Equity Financing

• Retained Earnings

• Trade Credit

Which source of finance involves leasing assets like machinery or vehicles and making periodic payments for their use?

• Equity Financing

• Bank Loan

• Trade Credit

• Leasing

What source of finance is often used by startups in exchange for equity and expertise?

• Retained Earnings

• Personal Savings

• Venture Capital

• Grants and Subsidies

If a business owner uses their own savings or personal assets to finance the company, it is called:

• Debt Financing

• Trade Credit

• Personal Savings

• Equity Financing

Which source of finance is suitable for businesses that need funds for working capital, expansion, or equipment purchases?

• Retained Earnings

• Bank Loan

• Debt Financing

• Venture Capital