By selling shares of ownership in their company, California Scientific acquires the funds needed to finance their research and development projects. California Scientific provides for their long-term funding needs through ________ financing

Question

Quizplus · Accepted Answer

By selling shares of ownership, California Scientific is raising funds through equity financing. Equity financing involves selling ownership in the company in exchange for capital, whereas debt financing involves borrowing money that must be repaid over time, retained financing involves reinvesting earnings back into the company and asset financing involves using assets as collateral for loans. Since the question specifically mentions selling shares of ownership, the answer is equity financing.

By Selling Shares of Ownership in Their Company, California Scientific