Question

With plans to build a $50 million theme park, Extreme Entertainment, Inc. intends to finance this project through the sale of additional shares of ownership in their firm. Selling new shares of stock represents ___________ financing.

Answer 1

Equity

Step-by-step explanation:

If the firm wishes to raise money by selling its shares of stock to the general public through the capital market, i. e. stock exchange market, it is called equity financing. It is often referred to as a primary stock market. As Extreme Entertainment, Inc. does not have much money to expand its business; it sells its share in the stock market to raise its capital.