Which of the following is a short-term source of finance suitable for a new business? A - OCR - GCSE Business - Question 6 - 2020 - Paper 1

A. Retained profit: Generally considered a long-term source of finance since it relies on profits accumulated over time.

B. Sale of business assets: This can generate funds but is often viewed as a long-term solution and may not be reliable for short-term needs.

C. Share issue: This refers to selling shares to raise capital and is usually a longer-term financing option suitable for established businesses.

D. Trade credit: This is a short-term financing option where businesses receive goods or services and pay for them later. It is ideal for new businesses that need immediate resources without upfront cash.

Based on the evaluations, the correct answer is D: Trade credit.