Which of the Following Statements Is (Are) Correct with Respect

question 11

Multiple Choice

Which of the following statements is (are) correct with respect to financing a business?

• A) Debt financing refers to money that is borrowed, while equity financing refers to money that is invested in the business by investors in return for a share of the ownership of the company.
• B) The most common source of debt financing is venture capitalists.
• C) Choosing between debt and equity financing involves trade-offs with regard to immediate vs. long-term profitability.
• D) Most new venture founders prefer equity financing because they are reluctant to give up any control to outsiders.
• E) All these statements are correct.

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