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The business can borrow money from the banks at an admitted rate of interest over a stipulated period of time. Bank loan is regarded as medium and long term source of finance that can be used by the business to budget their operations.Retained earnings: The Company can use their possessed profit for financing their various activities of business. It is a medium and long term finances (Browne, 2009). Retained earnings are the part of the business profits that are ploughed back by the business.
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