ITPEC IP April 2025 Question 91
ITPEC IP April 2025 — Question 91 of 100
Investment-based crowdfunding — funders provide capital and receive an investment return such as dividends from profits.
The compensation depends on the business's financial performance rather than repayment of a loan, a donation with no financial return, or delivery of a purchased product. Sharing profits with investors therefore matches the investment model.
Answer (d)
Why not others:
- (a) requires repayment of borrowed principal, usually with interest
- (b) provides funds without expecting economic compensation
- (c) rewards supporters with goods, services, or purchase rights
Key rule: Classify crowdfunding by the funder's return: interest for lending, no return for donation, a product for purchase-based funding, and investment income or equity for investment-based funding.
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