Business Studies - Source of Business Finance Quiz

What is equity financing?

• Selling company shares to raise capital

• Using personal savings to fund business activities

• Borrowing money from external sources to fund operations or expansion

• Receiving grants from the government to finance operations

What is the primary source of finance that involves reinvesting profits back into the business?

• Stock issuance

• Retained earnings

• Venture capital

• Bank loan

Which of the following is an example of an internal source of finance?

• Bank loans

• Government grants

• Personal savings

• Credit card debt

What is the purpose of short-term financing?

• Obtaining a loan for a short period of time to address immediate financial requirements

• Acquiring a car loan for a new vehicle

• Utilizing personal funds to cover expenses

• Investing money for a short period of time

What is short-term financing?

• Borrowing money for a long period to support business activities

• Using personal savings to fund a business for a long period

• Obtaining funds for a period of one year or less to support business activities or investment projects.

• Investing in stocks for a period of more than one year

What is an example of debt financing?

• Taking out a mortgage

• Receiving a scholarship

• Issuing corporate bonds

• Investing in mutual funds

Which of the following is considered an external source of finance?

• Stock issuance

• Venture capital

• Bank loan

• Retained earnings

Which of the following is a form of external financing?

• Personal loans

• Student loans

• Bank overdraft

• Angel investment

What is the purpose of short-term financing?

• Investing in long-term projects

• Saving money for retirement

• Taking out a mortgage for a new home

• Borrowing of funds for a short period of time to meet immediate financial needs

What is the purpose of long-term financing?

• Investment in stocks for long-term gains

• Funding for a period of more than one year to support business activities or investment projects.

• Funding for a period of exactly one year to support business activities

• Money borrowed for a few months to cover short-term expenses