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Questions and Answers
What is the primary classification of capital based on?
What is the primary classification of capital based on?
- The sources of funds, the period for which money is contributed, and the cost of the funds to the firm
- The contributors of funds, the period for which money is contributed, the cost of the funds to the firm, and the rights that accrue to the contributors of the funds (correct)
- The contributors of funds and the cost of the funds to the firm
- The contributors of funds and the period for which money is contributed
What are individuals or institutions contributing debt capital called?
What are individuals or institutions contributing debt capital called?
- Equity holders
- Lenders (correct)
- Promoters
- Shareholders
What do outside investors become when they contribute equity capital to a business?
What do outside investors become when they contribute equity capital to a business?
- Shareholders (correct)
- Promoters
- Lenders
- Equity holders
What are funds brought in by promoters and owners of the business called?
What are funds brought in by promoters and owners of the business called?
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When can equity capital be brought into a business?
When can equity capital be brought into a business?
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