Question : Which of the following represents a short-term source of finance?
Option 1: Equity shares
Option 2: Debentures
Option 3: Bank overdraft
Option 4: GDRs
Correct Answer: Bank overdraft
Solution : The correct answer is (c) Bank overdraft.
A bank overdraft represents a short-term source of finance. It is a facility provided by a bank that allows a company to withdraw more funds from its bank account than what is available in the account balance. It essentially provides a temporary borrowing arrangement to cover short-term cash flow needs.
Question : Which of the following is a long-term source of finance?
Option 1: Trade credit
Option 2: Bank overdraft
Option 3: Debentures
Option 4: Factoring
Question : Which type of shares are redeemable?
Option 2: Preference shares
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