Final answer:
C) Equity Financing
Corporations can obtain long-term funds without repayment through Equity Financing (C) by issuing stock, or through Retained Earnings (D) by reinvesting profits. Borrowing from banks (A) or through bonds (B) would not be suitable as they require repayment.
Step-by-step explanation:
When a corporation needs money for long-term financing without the requirement of repayment, the best option is Equity Financing
(C). Equity financing involves issuing stock and selling off company ownership to the public. Unlike borrowing from banks or issuing bonds,
equity financing does not require scheduled interest payments. Another source of funds that does not require repayment is Retained Earnings (D), which represent the reinvestment of profits back into the company.
Borrowing via banks or bonds entails a commitment to pay interest over time, representing a liability that the firm must manage, while retaining control of its operations and not being subject to shareholders' influence.
However, this borrowing method is not without the requirement of repayment, as interested loans and bonds must eventually be paid back, with interest.
Retained Earnings can be a source of financial capital for well-established firms with enough profits.
This method involves reinvesting profits into new equipment, structures, or R&D, and it does not require repayment to external parties since it is a reinvestment of the firm's own capital.