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What distinguishes debt financing from equity financing for a business?
  • a)
    Debt financing involves sharing business success.
  • b)
    Equity financing creates financial obligations.
  • c)
    Debt financing provides cash without financial obligations.
  • d)
    Equity financing leaves the business owner in full control.
Correct answer is option 'B'. Can you explain this answer?
Most Upvoted Answer
What distinguishes debt financing from equity financing for a business...
Debt financing distinguishes itself from equity financing by creating financial obligations. When a business opts for debt financing, it involves borrowing money that must be repaid with interest, which represents a financial obligation to the lender. Equity financing, on the other hand, involves selling ownership stakes in the business to investors.
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What distinguishes debt financing from equity financing for a business?a)Debt financing involves sharing business success.b)Equity financing creates financial obligations.c)Debt financing provides cash without financial obligations.d)Equity financing leaves the business owner in full control.Correct answer is option 'B'. Can you explain this answer?
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