Question

Match each type of financing with the method used to obtain it.

Equity financing
?
Taking a loan from a bank
Debt financing
?
Selling ownership in the
company
Public offering
?
Selling shares of stock on
the open market

Answer 1

Equity financing involves selling ownership in the company, while debt financing involves taking a loan from a bank or issuing bonds.

Step-by-step explanation:

Equity financing involves selling ownership in the company. This is typically done by offering shares of stock to private investors or through a public offering on the open market. Debt financing, on the other hand, involves taking a loan from a bank or issuing bonds. In this case, the company borrows money and commits to scheduled interest payments.

Answer 2

Equity financing is obtained by selling ownership in the company, while debt financing is obtained by taking a loan from a bank or issuing bonds. Public offering is a method of obtaining financing by selling shares of stock on the open market.

Step-by-step explanation:

Equity financing - Equity financing is obtained by selling ownership in the company. This means that the company sells shares of stock to investors, and in return, the investors become partial owners of the company.

Debt financing - Debt financing is obtained by taking a loan from a bank or issuing bonds. This means that the company borrows money and agrees to pay it back with interest.

Public offering - Public offering is a method of obtaining financing by selling shares of stock on the open market. This allows the company to raise capital by selling ownership to the public.