Which of the following is a feature of equity financing?
A) It represents a legal obligation to repay the original debt plus interest.
B) It involves pledging some assets-such as a home, real estate, machinery, and plant-as collateral.
C) It involves no explicit obligation or expectation, on the part of the investors, to be repaid their investment.
D) It specifies the amount of money to be repaid within a specific time frame for a specific interest rate.
E) It guarantees a portion of the loan to its partners that include private lenders, microlending institutions, and community development organizations.

Question

Quizplus · Accepted Answer

Equity financing does not involve an explicit obligation or expectation, on the part of the investors, to be repaid their investment. Instead, investors receive a share of ownership in the company in exchange for their investment.

Which of the Following Is a Feature of Equity Financing