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By selling shares of ownership in their company, Seattle Scientific acquires the funds needed to finance their research and development projects. Seattle Scientific provides for their long-term funding needs through ________ financing.

A) debt
B) equity
C) retained

User T Porter
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1 Answer

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Answer:

B) equity

Step-by-step explanation:

Equity financing is a way by which a company raises capital. It does that by receiving funds from investors in exchange of ownership of the company's shares. With this funding, the issuing company is not obligated to pay dividends to investors hence can retain their net earnings and invest in potential profitable projects. This features are evident in this company;Seattle Scientific making choice B correct.

With debt financing on the other hand, the company can issue bonds and it is obligated to pay interest on the loan in form of coupon payments for the term of the bond.

User Yohannes Masterous
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