Final answer:
An accredited investor is defined as someone who meets certain income or net worth standards. They are able to invest in riskier and more sophisticated investment opportunities and frequently provide capital to businesses through equity or debt investment.
Step-by-step explanation:
An accredited investor is best defined as Option C) Investors who meet specific income or net worth requirements. This term is used in finance and securities regulations to describe individuals or entities that are eligible to invest in certain types of higher-risk investments, including seed money, limited partnerships, hedge funds, and venture capital. Accredited investors are considered to be financially sophisticated and have the capacity to bear the risk of investment losses, as reflected by meeting certain predefined income or net worth criteria.
The concept of accredited investors is critical in the context of raising capital for businesses. Companies might seek financial capital through various means such as early-stage investors, reinvesting profits, borrowing through banks or bonds, and by selling stock. Accredited investors often participate in funding rounds for startups and established companies alike, providing capital in exchange for equity or debt securities.