Final answer:
Retained earnings generally provide the greatest part of a firm's financing, especially for established companies that reinvest their profits. New or struggling firms may need to seek alternative financial capital sources.
Step-by-step explanation:
Businesses have four primary sources of funds, and among them, retained earnings often provide the greatest part of a firm's financing. When firms earn profits, exceeding their costs, they can choose to reinvest a portion of these profits back into the business. This reinvestment can go towards purchasing equipment, building structures, or funding research and development activities. This method of financing is particularly significant for established companies that generate consistent profits. However, for new or struggling firms, finding reliable financial capital sources other than profits, such as borrowing from banks or issuing bonds, becomes essential to sustain and grow. Moreover, firms can also look into selling stock or seeking early-stage investors as a means of raising financial capital.