Methods of Finance Flashcards
What is Venture Capital?
Investment from an established business into another business in return for a percentage of ownership of the business.
What is a Grant?
Fixed amounts of capital provided to businesses by the government in order to encourage production or fund specific projects.
What is Trade Credit?
Paying suppliers a period of time after the goods/services have been received.
What is Share Capital?
Finance raised through the sale of shares.
What is an Overdraft?
The facility to overspend on a current amount up to an agreed amount. Overdraft limit is agreed with the bank, depending on credit history.
What is Leasing?
A business is allowed to benefit from the use of a product without actually having to buy it. Pay set amounts in instalments in order to use it for a period of time and it is returned at the end of the period.
What is a Loan?
A set amount of money provided for a specific purpose to be paid back with interest in accordance with terms of the loan agreement.
