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I have come across ”within any economic system, the equity investors provide the risk finance.”
I think it just means that they finance the business wven when there is a risk that they might lose their investment, right?
Yes, within any economic system, equity investors provide risk finance.
Equity investors, such as shareholders or venture capitalists, provide funding to businesses with the understanding that there is a risk of losing their investment.
They contribute capital to the business in exchange for ownership or shares, and their returns are dependent on the success and profitability of the business. While there is a potential for financial gain, equity investors also bear the risk of losses if the business does not perform well.
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