1.3.4 Sources of business finance

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Why might a business need finance?: To expand and launch new products
Which is a feature of short-term finance?: Used for needs up to three months
Long-term finance is most appropriate for which activity?: Buying expensive equipment and premises
What describes a bank overdraft?: Allows withdrawing more than balance
Which is a drawback of using an overdraft?: Bank can demand immediate full repayment
What is trade credit?: Supplier allows delayed payment for goods
What is a main advantage of trade credit for a buyer?: Improves short-term cash flow
A main feature of using personal savings to start a business is:: Owner keeps full control of business
What limits the use of retained profit as a finance source?: Only available if previous profits exist
Which describes share capital?: Raising money by selling company shares
A likely drawback of issuing shares is:: Original owners lose some control
What is a common feature of venture capital?: Investors gain some control and expertise
Which is an advantage of crowdfunding?: Tests public interest and aids marketing

Round complete