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Debt or equity

Exercise and reference answers

Upper category
Debt
Lower category
Equity
Items
  1. Category
    Debt
    Item
    Cheaper
  2. Category
    Debt
    Item
    Tax saving
  3. Category
    Debt
    Item
    Must repay
  4. Category
    Debt
    Item
    Fixed cost
  5. Category
    Equity
    Item
    No promise
  6. Category
    Equity
    Item
    Riskless
  7. Category
    Equity
    Item
    Dilutes
  8. Category
    Equity
    Item
    Owners
Instructions
Send each feature to the debt track or the equity track.

Explanation

_Source: syllabus Business Studies Part II, Chapter 9, Financial Management._
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