An investor provides resources to a business in exchange for
A) physical resources.
B) priority of claims in event of liquidation.
C) an ownership interest in the business.
D) a promise that the resources will be repaid at a given date.

Question

Quizplus · Accepted Answer

An investor provides resources to a business in exchange for an ownership interest in the business. This means that the investor will have a share in the profits and losses of the company and may also have voting rights in important decision-making processes. Choices A and D are incorrect as physical resources and promises of repayment do not necessarily constitute a form of investment. Choice B is partially correct as the investor may have priority of claims in the event of liquidation, but this is not the primary purpose of investing in a business.

An Investor Provides Resources to a Business in Exchange for