What is "Bailout"?

[Nivedha Kannan]

Bailout is a general term for extending financial support to a company or a country facing a potential bankruptcy threat. It can take the form of loans, cash, bonds, or stock purchases.

Statement Formation:

The government ended its $80 billion bailout of the U.S. auto industry on December 18, 2014.

[Hari priya]

A bailout is a situation in which a business, individual or govt offers money to a failing business in order to prevent the consequences that arise from a business downfall.

Bailouts can take the form of loans, bonds, stocks or cash.

[nivetha]

Bailout is the act of giving financial assistance to a falling business or economy to save it from collapse.

[Deepika Nautiyal]

<span style=”text-decoration: underline;”>For example :- </span>

Chrysler, a large U.S. automaker was in need of a bailout in the early 1980s. The U.S. government stepped in and offered roughly $1.2 billion to the failing company. Chrysler was able to pay the entire bailout back and is currently a profitable firm.

 

[Aravind Kumar]

.A high-risk, high-reward strategy with a 10% chance of bankruptingthe bank becomes purely a high-reward strategy when they know that the government willbail outretail banks rather than let private individuals lose their savings.

[Author]

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