Edexcel A Level Business - Theme 2.1 Questions with Complete Solutions| Rated A+

Internal finance - Money generated by the business or its current owners External finance - Money raised from sources outside the business Owner's Capital - The money provided by the owners in a business Sale of assets - when a business sells off its unwanted or unused assets to raise funds Retained profit - Profit after tax that is 'ploughed back' into the business Bank overdraft - An agreement between a business and a bank that means a business can spend more money that it has in its account (going 'overdrawn'). The overdraft limit is agreed and interest is only charged when the business goes overdrawn trade credit - the practice of buying goods and services now and paying for them later Grants - A sum of money given by a certain organisation, usually the government, for a certain reason or cause Crowdfunding - Where a large number of individuals invest in a business or project on the internet, avoiding the use of a bank Lease - A contract to acquire the use of resources such as property or equipment bank loan - A fixed amount loan from a bank which is generally used to finance long-term assets and is paid back in smaller monthly installments Share capital - Money introduced into the business through the sale of shares Venture capitalism - Providers of funds for small or medium-sized companies that may be considered too risky for other investors Collateral - An asset that might be sold to pay a lender when a loan cannot be repaid Limited liability - A legal status that means shareholders can only lose the original amount they invested in a business