Sources of capital - SS1 Commerce Past Questions and Answers - page 1
1
What is a debenture?
A
A share in a company
B
Short-term borrowing facility
C
Long-term debt instrument
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2
Which source of capital allows investors to become partial owners of a company?
A
Loans
B
Shares
C
Retained profit
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3
What is the purpose of retaining profits within a company?
A
Providing a source of capital for future investments
B
Paying dividends to shareholders
C
Financing short-term expenses
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4
What is an overdraft?
A
Long-term borrowing facility
B
Funds borrowed from individuals
C
Short-term borrowing facility
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5
Which source of capital involves regular interest payments and repayment of principal?
A
Loans
B
Shares
C
Debentures
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6
State one advantage of issuing shares for a company.
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7
What is the primary purpose of obtaining a loan for a company?
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