Question

We associate the term debt finance with a. the bond market, and we associate the term equity finance with the stock market. b. the stock market, and we associate the term equity finance with the bond market. c. financial intermediaries, and we associate the term equity finance with financial markets. d. financial markets, and we associate the term equity finance with financial intermediaries.

Answer 1

Answer: Option A  

     

Explanation: In simple words, debt financing refers to a process under which an organisation borrows money from other parties without giving any share in the ownership rights.

These finances are usually gathered by selling bonds bills and notes to the general public. Whereas, equity finance sells its ownership rights and raise money from it.

Hence from the above we can conclude that the correct option is A.