There are two major advantages of getting a loan versus investment capital:
A) the money doesn't have to be paid back and lenders typically take an active interest in their borrowers
B) banks are reliable sources of funding for startups and interest payments are tax deductible
C) the money doesn't have to be paid back and no ownership in the firm is surrendered
D) no ownership in the firm is surrendered and interest payments are tax deductible
E) banks are reliable sources of funding for startups and lenders typically take an active interest in borrowers

Question

Quizplus · Accepted Answer

Getting a loan means that no ownership in the firm is surrendered and interest payments are tax deductible. This is a major advantage compared to investment capital, where ownership in the firm is typically surrendered. Additionally, interest payments on loans are tax deductible, providing a financial benefit to the borrower.

There Are Two Major Advantages of Getting a Loan Versus