Question at position 12 The term for a global movement to help eradicate poverty by lending small sums used to start small businesses is referred to as _____.foreign direct investmentsmicrofinanceventure capital investmentpreferred financing

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Question: The term for a global movement to help eradicate poverty by lending small sums used to start small businesses is referred to as _____.
Options: 1) foreign direct investments 2) microfinance 3) venture capital investment 4) preferred financing

Option 1: foreign direct investments. This term refers to investments by a company or individual from one country into business interests in another country, typically through ownership or control of a foreign company. It is not specifically about lending small sums to individuals to start small businesses, but rather about cross-border ownership and control. Therefore, this option misaligns with the described micro-lending focus.

Option 2: microfinance. This is the term that directly matches the description: providing small loans (microloans) and financial services to people who lack access to traditional banking, often to help them start or expand small businesses. It is widely associated with poverty alleviation on a global scale and is implemented by various microfinance institutions and programs worldwide. The concept precisely fits the idea of a global movement aimed at enabling entrepreneurship through accessible credit, especially for the poor.

Option 3: venture capital investment. Venture capital involves funding typically high-growth startups by investors who seek equity stakes and potential high returns. While it supports entrepreneurship, it is not defined by lending small sums to the poor or by a global poverty-reduction movement focused on micro-entrepreneurs. Instead, it targets scalable ventures typically with significant capitalization needs and investor expectations for upside returns.

Option 4: preferred financing. The term “preferred financing” is not a standard descriptor for a global poverty-reduction initiative. In financial terminology, “preferred” might refer to preferred stock or preferred terms in financing arrangements, but it does not capture the specific concept of extending small loans to start micro-businesses as a worldwide movement. Consequently, this option does not fit the described initiative.

To summarize, option 2 best aligns with the stated concept of a global movement that uses small loans to empower individuals to start small businesses, aiming at poverty eradication. The other options describe distinct financial concepts that do not capture the micro-lending, poverty-focused mission described in the question.

Question at position 12 The term for a global movement to help eradicate poverty by lending small sums used to start small businesses is referred to as _____.foreign direct investmentsmicrofinanceventure capital investmentpreferred financing

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