Business Finance Sources Quiz

What is equity financing?

• Equity financing is a method of funding a company through government grants.

• Equity financing is a method of raising capital by taking out a loan.

• Equity financing is a method of borrowing money from a bank.

• Equity financing is a method of raising capital for a company by selling shares of ownership to investors.

Which of the following is an example of equity financing? a) Bank loan b) Venture capital c) Trade credit d) Retained earnings

• a) Bank loan

• c) Trade credit

• d) Retained earnings

• b) Venture capital

What is debt financing?

• Debt financing is a method of raising capital by borrowing money from lenders or issuing bonds.

• Debt financing is a method of raising capital by receiving grants from the government.

• Debt financing is a method of raising capital by investing in stocks.

• Debt financing is a method of raising capital by selling company shares.

Which of the following is an example of debt financing? a) Selling company shares b) Taking a bank loan c) Using personal savings d) Reinvesting profits

• b) Taking a bank loan

• a) Selling company shares

• c) Using personal savings

• d) Reinvesting profits

What are internal sources of business finance?

• Bank loans, venture capital, and crowdfunding.

• Government grants, personal savings, and trade credit.

• Stock issuance, angel investors, and factoring.

• Retained earnings, sale of assets, and depreciation funds.

Which of the following is an example of an internal source of business finance? a) Issuing bonds b) Obtaining a government grant c) Selling company assets d) Using retained earnings

• d

• c

• b

• a

What are external sources of business finance?

• Loans, investments, issuing shares or bonds

• Government subsidies, tax incentives, sponsorships

• Personal savings, credit cards, overdrafts

• Grants, donations, crowdfunding

Which of the following is an example of an external source of business finance? a) Selling company shares b) Using retained earnings c) Reinvesting profits d) Selling company assets

• a) Selling company shares

• d) Using personal savings

• c) Issuing corporate bonds

• b) Taking out a bank loan

Which source of business finance involves ownership dilution?

• debt financing

• venture capital

• equity financing

• angel investing

Which source of business finance involves borrowing funds that need to be repaid with interest?

• equity financing

• venture capital

• angel investment

• debt financing