Question

Identify the source of finance in the following cases :-
(1) The holders are the primary risk bearers .
(2) Hybrid securities.
(3) Funds for new and innovative projects.
(4) Funds do not have floatation cost.
(5)This source puts permanent obligation
on the company to pay interest irrespective of profits.
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Answer 1

Answer:

A security is a tradable financial asset. The term commonly refers to any form of financial instrument, but its legal definition varies by jurisdiction. In some countries and languages people commonly use the term "security" to refer to any form of financial instrument, even though the underlying legal and regulatory regime may not have such a broad definition. In some jurisdictions the term specifically excludes financial instruments other than equities and fixed-income instruments. In some jurisdictions it includes some instruments that are close to equities and fixed income, e.g., equity warrants

Answer 2

Explanation:

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Primary Risk Bearers: Equity- shareholders are the primary risk bearers of the company. In case the company suffers losses then equity- shareholders have to bear the loss. The due payment is given to creditors before paying the equity shareholders.