Equity capital serves as ____________ capital as it is to be repaid only at the time of liquidation of a company.

Temporary

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Permanent

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Fluctuating

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Fixed

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Solution

The correct option is B Permanent
Equity share capital is the prerequisite before the creation of a company.
It is a source of finances raised for the formation of the company and it also represents the ownership of the company.
Equity capital serves as a permanent capital as it is to be repaid only at the time of liquidation.

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