Determine whether each of the following is direct financing or indirect financing.(2 points)

Question

investing in a friend's new business

Direct Financing

Indirect Financing
taking out a loan at a commercial bank

Direct Financing

Indirect Financing
investing in a mutual fund

Direct Financing

Indirect Financing
selling stock on the stock market

Direct Financing

Indirect Financing

Answer 1

Here are the classifications for each scenario:

1. Investing in a friend's new business
   Direct Financing

2. Taking out a loan at a commercial bank
   Indirect Financing

3. Investing in a mutual fund
   Indirect Financing (as the mutual fund pools money from multiple investors to invest)

4. Selling stock on the stock market
   Direct Financing (this involves directly buying and selling shares in companies)

So, the classifications are:

1. Direct Financing
2. Indirect Financing
3. Indirect Financing
4. Direct Financing