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Finance (Sources of finance (Bank overdraft (Organisations are allowed to…
Finance
Sources of finance
Bank overdraft
Organisations are allowed to take more money out of their account than they actually have in it, however the interest rates are very high so it is not a long term method of borrowing.
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Hire Purchase
Organisation pay for equipment/vehicles over a period of time, and interest is added. The vehicle is owned by the company, however, at the end of the period of time, it is owned by the person.
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Mortgage
A large amount of money borrowed from the bank to buy property. Usually it is repaid over 25 years along with interest.
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Venture Capital
This is money given by private individuals, and they will want part of the business in exchange for the money they have given.
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