Practice Sources Of Finance (2.2) - Understanding Finance

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10 questions

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Quiz
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6 sample questions

Question 1.
What are some key components of Owned Capital?
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Think about what the owner invests in.
Question 2.
Is a bank loan an example of Owned Capital? Why or why not?
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Consider if the funds need to be returned or not.
3Question 3.
What is Owned Capital?
- Funds borrowed from banks
- Funds invested by owners
- Funds raised from the public
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Think about who invests their money into the business.
4Question 4.
Borrowed Capital requires repayment.
- True
- False
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Consider the obligations when taking a loan.
Question 5.
A business owner wants to start a new venture costing $50,000. Should they use Owned Capital or seek Borrowed Capital? List the advantages and disadvantages of each choice.
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Analyze the balance between risk and control.
Question 6.
Evaluate a scenario where a company has a balance of 70% Owned Capital and 30% Borrowed Capital. Discuss how this could impact their decision-making and financial stability.
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Consider long-term effects on liquidity and operations.

6 more questions in this section. Enroll free to practise them all.