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JAMB Economics 2001 Question 32

Question 32

Financial Institutions

The raising of funds by selling stocks to the public is called

  1. A.equity financing
  2. B.stock financing
  3. C.debt financing
  4. D.loan financing
Show the answer and explanation

Answer: A (equity financing)

Explanation

Selling shares gives buyers ownership (equity) in the company, so raising money this way is equity financing.