Equity is the difference between the value of your assets and your liabilities. It represents the portion of your assets that you own outright, or the net worth of your business. Answer A refers to cash flow, while answer B only considers the number of assets, not their value. Answer D only looks at liabilities and doesn't take into account assets.

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Equity Is

Question 38

Multiple Choice

Equity is:

A) How much cash you have in the bank minus what you owe
B) How many assets you have
C) The value of your assets minus your liabilities
D) How many liabilities you have outstanding

Correct Answer: