Equity Financing Differs from Security Financing in That, with Equity

question 86

Multiple Choice

Equity financing differs from security financing in that, with equity financing, a company:

• A) must pay at least 1.5% interest on all investments
• B) must pay back at least half a shareholder's investment
• C) has complete liability to repay shareholders the amount they have invested
• D) must repay all investments, but has no specific time limit for doing so
• E) none of the other choices are correct

---

Definitions:

Lower Of Cost

A principle requiring inventory to be recorded at the lower of its original cost or current market value, ensuring valuation is not overstated.