Question

 Explain briefly the sources of long term finance and state which one you consider best and why?

09 Apr 2024
Answer :
Word Count : 545

In financial management, long-term finance refers to funds acquired for investment in assets and projects that are expected to yield returns over a period typically exceeding one year. There are several sources of long-term finance, each with its own characteristics and suitability for different situations:

1. Equity Financing:
   - Issuing shares or equity in the company to investors.
   - Can come from initial public offerings (IPOs) or subsequent stock issuances.
   - Does not require repayment of principal, but investors expect dividends or capital appreciation in return.
   - Provides permanent capital and does not impose fixed payment obligations.

2. Debt Financing:
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