Question

For startup firms, the cost of buying real estate, building facilities, and purchasing equipment often exceeds the firm's ability to provide funds for those needs on its own. Which of the following reasons that motivate firms to seek funding or financing is illustrated in this example?

Answer 1

Capital investment

Explanation:

Capital investment is a sum of money that has been provided by a company for further investment to run the business objectives. This capital investment is related to the company acquisition such as manufacturing the plant, the real estate and the machinery. The money in capital investment comes from anywhere. The company that has startup needs capital investment that they bring it from venture capital firm and other firms. The main purpose of capital investment is to develop the product and market the product.