NCERT Solutions for Class 11 Business_Studies Chapter 8 Source of Business Finance


The term finance means money or fund. The requirements of funds by business to carry out its various activities is called business finance. Finance is needed at every stage in the life of a business. A business cannot function unless adequate funds are made available to it. Sources of business finance is a chapter that furnishes an outline of the different sources from where the finance can be acquired. It covers different concepts like – meaning, nature and significance of business finance, classification of sources of funds – period basis, source of generation basis, sources of finance, retained earnings. Merits and demerits, trade credit – merits and limitations, factoring – advantages and disadvantages, lease financing, public deposits, commercial paper (CP), issue of shares, debentures, commercial bank, financial institutions, international financing.