Business – 5.2 Sources of finance – Business ownership and sources | e-Consult
5.2 Sources of finance – Business ownership and sources (1 questions)
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Justification of restrictions:
- Equity shares: Not available to sole traders or partnerships because there is no separate share capital; ownership is tied to individuals.
- Public debt (bonds): Typically limited to PLCs, which have the regulatory framework and market credibility required to issue bonds to the public.
- Bank loans: Accessible to all forms, but the terms improve as the business moves to a limited company due to limited liability and stronger credit histories.
- Personal savings/loans: Always available to the owners regardless of form, but become less central as larger, external sources become accessible.