CAIE A-Level Business 5.2.4 Selecting an Appropriate Source of Finance

CAIE A-Level Business 5.2.4 Selecting an Appropriate Source of Finance
Cambridge International AS & A Level Business 9609 syllabus for exams in 2026, 2027 and 20282026–2028

Practise evaluating loans, venture capital and other sources against purpose, duration, cost, repayment, security and control before recommending finance for the case.

How this is tested

  • apply the amount, duration and purpose of finance before comparing any available source
  • analyse interest, repayment, security and gearing effects on cash flow and financial risk
  • judge suitability against loss of control, flexibility, owner priorities and realistic alternatives

Question 6(b)

[Maximum number: 12]

'A large bank loan is the most appropriate source of finance for the expansion of a furniture retailer.'

Evaluate this view.