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Correspondingly, an entity where earnings is lower than expenditure can raise capital normally in one in all two methods: (i) by borrowing within the form of a loan (private individuals), or by promoting government or company bonds ; (ii) by a corporation promoting fairness , also called inventory or shares (which can take numerous types: most well-liked inventory or widespread inventory ). The house owners of both bonds and inventory could also be institutional buyers – monetary institutions such as funding banks and pension funds – or non-public individuals, called non-public investors or retail buyers.
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