Final answer:
Crowdfunding relies on contributions from a large number of people, offering an alternative to traditional funding like bank loans or obtaining money from angel investors, without necessarily giving away business ownership.
Step-by-step explanation:
Crowdfunding is a funding option for small businesses where funds are obtained through contributions from a large number of people. It does not involve obtaining loans from financial institutions (option A) or giving up ownership (option B). Additionally, crowdfunding is not a government-sponsored program (option D). Instead, crowdfunding platforms allow entrepreneurs to showcase their business ideas or projects to potential backers, who can then choose to contribute financially to support the venture.
In the context of funding options for small businesses, the statement that is true of crowdfunding is: C) It relies on contributions from a large number of people. Unlike traditional funding methods, crowdfunding does not necessarily involve obtaining loans from financial institutions or requiring entrepreneurs to give up ownership in exchange for funds, which contrasts with the approaches involving angel investors or bank loans. It also is not typically a government-sponsored program. Instead, through a crowdfunding campaign, a large group of individuals contributes money, often via an online platform, to support the business or project. This method may offer rewards or future product discounts but generally does not involve giving away equity or becoming responsible to a board of directors and shareholders.