Funds Lent to Start-Up Firms in Return for Shares of the Profit

question 123

Multiple Choice

Funds lent to start-up firms in return for shares of the profit if the firms succeed are called

• A) retained earnings.
• B) time deposits.
• C) venture capital.
• D) transfer payments.

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Definitions:

Long-Term Debt

Debt that is due to be paid off over a period longer than one year.

Earnings Per Share

A metric that calculates the portion of a company's profit allocated to each outstanding share of common stock, indicating a company's profitability.

Treasury Stock

Shares that were issued and subsequently reacquired by the company, reducing the amount of outstanding stock on the open market.

Cash Dividends

Payments made by a corporation to its shareholder members from its profits or reserves.