The Authors Identify Four Alternative Financial Instruments for Sourcing Equity

question 81

Essay

The authors identify four alternative financial instruments for sourcing equity abroad. Identify and explain one of these techniques. In your answer provide a motivation as to why a firm would wish to choose this particular technique for raising equity abroad.

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Definitions:

Commercial Banks

Financial institutions that provide loans, accept deposits, and offer basic financial products like savings accounts to the public.

Financial Matters

Issues or activities related to the management, investment, and control of money and assets.

Venture Capital Fund

A fund that invests in high-growth companies in exchange for equity, or ownership stakes, typically in early-stage companies.

Private Placement

The offering of securities to a relatively small number of select investors as a way of raising capital.