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Entrepreneurial Planning — Entrepreneurship STD 12 Commerce — Question

CBSE BoardEnglish MediumSTD 12 CommerceEntrepreneurshipEntrepreneurial Planning1 Mark
Question
State any two limitations of owner’s fund.
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Answer

Two Limitations of owned funds are:-
  1. If the growth prospects and profit earning capacity are not high, it is difficult to raise owners funds.
  2. The amount of Owners funds depends upon the the number of persons who are ready to take the risk of investing their personal savings.
  3. Dilution of control takes place as holders of owned funds have voting rights.
  4. The cost of raising owned funds is not fixed and known as high profits leads to higher dividends.

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