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    Answer For Unit 9

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    Khim Lovelysmile Real II
    1. Corporations need capital to start, operate, and expand their business. They acquire capital through either equity financing from owners investing in the corporation, or debt financing from borrowing funds from outside sources. 2. When a corporation sells stock, each share entitles the purchaser to ownership in the corporation and dividends. There is risk for initial stock purchasers since the corporation has no performance record yet. 3. Corporations can also acquire capital by selling bonds, through which bondholders lend money and receive regular interest payments in return.

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    Answer For Unit 9

    Uploaded by

    Khim Lovelysmile Real II
    288 views5 pages
    1. Corporations need capital to start, operate, and expand their business. They acquire capital through either equity financing from owners investing in the corporation, or debt financing from borrowing funds from outside sources. 2. When a corporation sells stock, each share entitles the purchaser to ownership in the corporation and dividends. There is risk for initial stock purchasers since the corporation has no performance record yet. 3. Corporations can also acquire capital by selling bonds, through which bondholders lend money and receive regular interest payments in return.

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    Answer for Unit 9

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    1. Corporations need capital to start, operate, and expand their business. They acquire capital through either equity financing from owners investing in the corporation, or debt financing from borrowing funds from outside sources. 2. When a corporation sells stock, each share entitles the purchaser to ownership in the corporation and dividends. There is risk for initial stock purchasers since the corporation has no performance record yet. 3. Corporations can also acquire capital by selling bonds, through which bondholders lend money and receive regular interest payments in return.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    288 views5 pages

    Answer For Unit 9

    Uploaded by

    Khim Lovelysmile Real II
    1. Corporations need capital to start, operate, and expand their business. They acquire capital through either equity financing from owners investing in the corporation, or debt financing from borrowing funds from outside sources. 2. When a corporation sells stock, each share entitles the purchaser to ownership in the corporation and dividends. There is risk for initial stock purchasers since the corporation has no performance record yet. 3. Corporations can also acquire capital by selling bonds, through which bondholders lend money and receive regular interest payments in return.

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    of 5

    Answer for Unit 9 “ACQUISITION OF CAPITAL”

     Comprehension
    A. Answer the following questions about acquisition
    of fund. Questions with asterisks (*) cannot be
    answered directly from the text.
    1. A corporation needs capital in order to start up,
    operate, and expand its business.
    2. Two basic types of financing are equity financing
    and debt financing.
    3. Equity financing refers to funds that are invested
    by owners of the corporation. On the other hand, debt
    financing refers to funds that are borrowed from
    sources outside the corporation.
    4. Each share entities the purchase to certain
    amount of ownership.
    5. The initial sales involve some risk on the part the
    buyers because the corporation has no record of
    performance.
    6. The stockholders may profit through increased
    valuation of the share of stock as well as by receiving
    dividends.
    7. If the corporation is not successful, the stock
    holder may take a severe loss on fire initial stock
    investment.
    8. The corporation benefit from selling bonds by
    getting more investment that can borrow money from
    investor. In addition, bond holder’s benefit from
    purchasing bonds by getting interest payment from
    corporation during the time and money are borrowed.
    9. To be honest, I have never known someone who
    has ever purchased bonds, but actually for my own
    idea I think that purchasing bonds is one of the best
    thing you can find your interest from day by day.
    10. Sure for my present financial situation right now,
    I would choose purchase of stock because we can find
    the profit back also during or before you decide to
    purchase some bonds you have to detect about the
    company that you are going to purchase.
    B. Circle the letter of the answer that best completes
    each of the sentences below.
    1. The process of acquiring capital in known as : c.
    financing
    2. The unit of ownership in a corporation is a: b.
    share
    3. All corporation receive their starting capital by: d.
    selling stock
    4. The sale of corporation bonds is an example of a.
    debt financing.
    5. A corporation may be forced to sell its assets if it
    does not: c. make the required payments to
    bondholders.
     Vocabulary Exercises
    B. Look at the terms in the left-hand column and find
    the correct synonyms or definitions in the right-hand
    column. Copy the corresponding letters in blanks.
    1. g. a sum paid for borrowing money
    2. d. extreme
    3. f. the contract or promise that compels one to
    follow a certain course of action
    4. h. anything or place from which something is
    obtained
    5. b. give one a right
    6. c. occurring at regular times
    7. j. print for sale or distribution
    8. i. a time limit for finishing something
    9. a. satisfy
    10. e. first
    C.Complete the sentences with the noun, verb and
    adjective forms provided.
    1. a. consideration
    b. considerable
    c. considered
    2. a. initial
    b. has initiated
    c. initiation
    3. a. to invest
    b. investment
    c. invested
    4. a. to acquire
    b. acquisition
    c. acquired
    5. a. financial
    b. are financed
    c. finance

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