Question

6. Which of the following is NOT true about raising capital?

a. Start-up money is critical to a business.
b. Capital may come from the owner's personal funds.
c. Once raised, capital does not have to be raised again.
d. Loans from financial institutions are common sources of capital.

Answer 1

Answer: c. Once raised, capital does not have to be raised again.

Step-by-step explanation:

Additional capital is more likely than not to be needed by a company as operations continue because new projects will need to be invested in that cannot be covered by the company's retained earnings but need to be invested in to grow and expand the business.

This is why companies issue bonds and debentures, go to financial institutions for loans and raise additional capital from secondary share offerings.