All of the Following Are Major Advantages of Buying an Existing

question 39

Multiple Choice

All of the following are major advantages of buying an existing business over starting a new business EXCEPT

• A) less risk is involved.
• B) product or service is not known in the marketplace.
• C) obtaining financing is often easier.
• D) existing suppliers and employees are in place.

---

Definitions:

Promissory Note

A promissory note is a financial instrument in which one party promises in writing to pay a determinate sum of money to another, either at a fixed or determinable future time or on demand of the payee.

Time Draft

A type of credit instrument in international trade where payment is deferred for a specified period after the buyer accepts the draft.

Banker's Acceptance

A short-term financial instrument issued by a company but guaranteed by a bank, commonly used in international trade.

Cash Discount

A reduction in the invoice price offered by a seller to encourage early payment by the buyer.