📢 Too many exams? Don’t know which one suits you best? Book Your Free Expert 👉 call Now!

    Question

    Which of the following funds raised by a company would

    be classified as Quasi Equity?  
    A Unsecured loans from friends and relatives Correct Answer Incorrect Answer
    B Unpaid share capital Correct Answer Incorrect Answer
    C Capital reserve Correct Answer Incorrect Answer
    D All of the above Correct Answer Incorrect Answer
    E None of the above Correct Answer Incorrect Answer

    Solution

    Quasi-equity is a hybrid form of finance with characteristics of both  de bt  and equity investments. Quasi-equity offers non-dilutive equity risk capital that is paid back based on the performance of the company.    Q uasi-equity financing  would include either being an unsecured loan or being a flexible loan repayment schedule. Mezzanine debt and junior debt are examples of quasi-equity financing as they are both usually unsecured and flexible when it comes to the repayment schedule of the loan.  

    Practice Next
    More Financial Management Questions

    Relevant for Exams:

    ask-question