Which of the following best defines "equity capital"?

The definition of "equity capital" is accurately captured as the funds raised by a company through the issuance of shares. This capital represents ownership interest in the company, as shareholders purchase these shares in exchange for equity ownership. In essence, when investors buy shares, they are providing the company with necessary funds to grow and operate without the obligation to repay that investment, unlike debt financing.

Equity capital plays a critical role in financing business activities, expansion projects, or acquisitions. It is an essential component of a company's capital structure, balancing risk and return for investors. This approach allows companies not only to fund their operations but also to align their interests with shareholders, fostering a mutual benefit as the company grows.

The other options describe different financial concepts that are not aligned with the definition of equity capital. Borrowed money represents debt obligations, reserved funds are more related to cash management, and revenue relates to income generated from operational activities. Therefore, these alternatives do not encapsulate the nature of equity capital as effectively as the chosen answer.