Question

The cheapest source of finance is

Options

• Debenture

• equity share capital

• preference share

• retained earning

Answer 1

retained earning

Explanation -

Retained earnings are the cheapest form of financing. After paying dividends, an organization's retained income is the portion of its net income or profits that it keeps. An organization's retained revenues or profits might be reinvested for expansion, modernization, and other purposes. There are no costs or risks associated with it. Furthermore, unlike other forms of financing, it does not impose any payback obligations.