ITPEC FE Morning April 2023 Question 66
Among the mechanisms that are utilized on the Internet, which of the following is an explanation of crowdfunding?
Explanation
Raising money from many unspecified individuals who back a project published on a website — crowdfunding finances a project from the crowd, in return for products or rights.
The project owner publishes the plan and the target amount on an Internet platform, and individuals who support it contribute money. Depending on the type, backers receive the product or another reward (reward-based), a share of profits or equity (investment-based), or nothing at all (donation-based).
Answer (d)
Why not others:
- •(a) — outsourcing work to an unspecified number of people over the web is crowdsourcing: the crowd supplies labour, not money
- •(b) — showing the transactions of accounts at several financial institutions after a single login is account aggregation, a fintech service
- •(c) — the advertiser paying the site operator when a visitor buys through the published link is affiliate marketing
Key rule: Crowdfunding gathers money from the crowd; crowdsourcing gathers work from the crowd.
Business Industry · AI-written, may contain errors
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