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Navigating Debt vs. Equity Financing in Entrepreneurship

Navigating Debt vs. Equity Financing in Entrepreneurship

Assessment

Interactive Video

Business

6th - 10th Grade

Practice Problem

Hard

Created by

Amelia Wright

FREE Resource

The video tutorial narrates the journey of a small business owner who sells natural juices. Initially, the owner faces challenges in expanding the business due to transportation issues. The owner considers a loan from his grandfather, who offers two interest options. However, the owner's uncle proposes an investment in exchange for equity, which the owner accepts. This investment helps the business grow significantly, with the uncle's connections aiding in further expansion. The owner successfully repays the uncle while enjoying increased profits.

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9 questions

Show all answers

1.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is the best-selling juice flavor in the business?

Apple

Strawberry

Orange

Grape

2.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Why does the business owner need a new vehicle?

To impress customers

To replace a broken car

To fit more boxes of juice

To travel to new towns

3.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What does the grandfather offer to help with the purchase of the new vehicle?

A partnership

A bond

A grant

A gift

4.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is the interest rate if the loan is paid off in a year?

1%

2%

3%

4%

5.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What additional benefit does the uncle offer besides buying the pickup?

A new store location

Extra seed money for packaging

Marketing services

Free advertising

6.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What does the uncle receive in exchange for his investment?

A share of the sales

A higher interest rate

A management position

Equity in the business

7.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

How much equity does the uncle receive in the business?

10%

15%

5%

20%

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