Finance Durations Quiz
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Questions and Answers

What is short term finance?

  • Borrowing money for over five years
  • Borrowing money for one to five years
  • Issuing shares
  • Borrowing money for less than a year (correct)

    • What is medium term finance?

  • Borrowing money for one to five years (correct)
  • Borrowing money for over five years
  • Borrowing money for less than a year
  • Selling assets

    • What is long term finance?

  • Borrowing money for one to five years
  • Borrowing money for over five years (correct)
  • Borrowing money for less than a year
  • Factoring of debt

    • What is equity capital?

    <p>Share issue</p> Signup and view all the answers

    What are the reasons businesses need finance?

    <p>To manage cash flow</p> Signup and view all the answers

    What are the different sources of finance?

    <p>Trade credit</p> Signup and view all the answers

    What is the role of the finance department?

    <p>Financial decision making</p> Signup and view all the answers

    What is the purpose of working capital?

    <p>To pay for day-to-day business activities</p> Signup and view all the answers

    What is an example of long-term source of finance?

    <p>Bank loans</p> Signup and view all the answers

    What is the purpose of micro finance?

    <p>To provide investment for entrepreneurs who can't secure finance from banks</p> Signup and view all the answers

    What is the main idea behind crowdfunding?

    <p>Encouraging many people to invest small amounts into a project</p> Signup and view all the answers

    What is the purpose of matching the source of finance to the use?

    <p>To ensure that the finance is used for the intended purpose and time period</p> Signup and view all the answers

    What does gearing measure in the context of business finance?

    <p>The proportion of total capital raised from long-term loans</p> Signup and view all the answers

    What is the primary purpose of issuing shares for a limited company?

    <p>To raise capital from new and existing shareholders</p> Signup and view all the answers

    What is the main function of trade credit in business finance?

    <p>To buy something and not pay for it immediately</p> Signup and view all the answers

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