For a period up to 12 months, which of the following is suitable:

Correct option is A

Short-term finance refers to financing options that are suitable for a period of up to 12 months. It is typically used to meet immediate working capital requirements or short-term operational needs. Examples include short-term loans, credit lines, and trade credit.

Important Key Points:

• Used for funding immediate or urgent needs.
• Typically involves lower interest rates compared to long-term finance.
• Must be repaid within one year.
• Commonly used by businesses to finance day-to-day operations.
• Short-term financing is crucial for maintaining liquidity.
• Provides quick access to capital with minimal documentation.

Knowledge Booster:

• (b) Mid-term finance: Financing for periods of 1 to 5 years, typically used for expansion or new projects.
• (c) Long-term finance: Financing for over 5 years, used for major investments like infrastructure or equipment.
• (d) Year long finance: This term is not a standard category in financial terminology; it's similar to short-term finance in duration but not a recognized classification.