Business Studies·Finance in the private & public sector · NSSCO 2.3
Sources of finance: short-term, long-term & internal
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Every business needs money — to open its doors, to grow, to buy machines, and to keep cash flowing day to day. But money can come from many different places, and choosing the wrong one is a costly mistake. In this lesson we learn why a business needs funds, the short-term and long-term sources it can use, the difference between internal and external money, how the public sector is financed, and exactly what a bank or an investor checks before saying yes.
What you'll learn in this lesson
By the end you should be able to (NSSCO Business Studies 2.3):
- Identify the main needs for funds and explain how such needs can be met
- Identify and comment upon the main sources of private and public sector finance
- Explain the main ways of seeking finance from these sources
- Identify the main ways in which a business is able to use funds from internal sources
- Explain the factors which financial providers (banks, shareholders, institutions) will consider in providing funds
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