Question 1

Going private is a form of acquisition and leverage buyout financing.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following statements about the demographic patterns of informal investors is not true

Accepted Answer

A)  Many informal investors belong to angel networks. 
B)  Most informal investors are well educated, with many having graduate degrees. 
C)  Informal investors will finance firms anywhere, particularly in the United States. 
D)  The majority of informal investors do not expect to play an active role in ventures financed. 
A)  Many informal investors belong to angel networks. 
B)  Most informal investors are well educated, with many having graduate degrees. 
C)  Informal investors will finance firms anywhere, particularly in the United States. 
D)  The majority of informal investors do not expect to play an active role in ventures financed.

Question 3

The underwriting syndicate is a group of firms involved in selling stock to the public.

Accepted Answer

A) True 
 B)False

Question 4

In most cases,the venture capitalist:

Accepted Answer

A)  seeks control of the company. 
B)  would prefer to not be a part of the board of directors. 
C)  is not involved in developing strategic plans. 
D)  expects the management team to run the daily operations. 
A)  seeks control of the company. 
B)  would prefer to not be a part of the board of directors. 
C)  is not involved in developing strategic plans. 
D)  expects the management team to run the daily operations.

Question 5

________ is the form of the transaction when money is obtained by a company.

Accepted Answer

A)  Deal structure 
B)  Underwriting 
C)  Equity swap 
D)  Debt swap 
A)  Deal structure 
B)  Underwriting 
C)  Equity swap 
D)  Debt swap

Question 6

Going public:

Accepted Answer

A)  is often viewed negatively by risk-averse venture capitalists. 
B)  ensures that the company gains control in decision making. 
C)  increases flexibility for the company. 
D)  enhances the company's ability to obtain future funds. 
A)  is often viewed negatively by risk-averse venture capitalists. 
B)  ensures that the company gains control in decision making. 
C)  increases flexibility for the company. 
D)  enhances the company's ability to obtain future funds.

Question 7

Identify the main advantages and disadvantages of going public.

Accepted Answer

A.Advantages-ability to obtain equity ca

Question 8

The securities of certain smaller companies going public must also be qualified under the ________ of each state where the securities will be offered.

Accepted Answer

A)  Securities and Exchange Commission 
B)  Markets Improvement Act 
C)  Internal Revenue Service 
D)  blue sky laws 
A)  Securities and Exchange Commission 
B)  Markets Improvement Act 
C)  Internal Revenue Service 
D)  blue sky laws

Question 9

The shorter the time before a company goes public,given that profits and sales growth occur,the less percentage of equity the entrepreneur will have to give up per dollar invested.

Accepted Answer

A) True 
 B)False

Question 10

Included in the guidelines for dealing with venture capitalists,the entrepreneur should:

Accepted Answer

A)  approach the venture capitalist directly. 
B)  bring a lawyer to all meetings. 
C)  disclose any significant problems in the initial meeting. 
D)  assure the venture capitalist that "There is no competition for this product." 
A)  approach the venture capitalist directly. 
B)  bring a lawyer to all meetings. 
C)  disclose any significant problems in the initial meeting. 
D)  assure the venture capitalist that "There is no competition for this product."

Question 11

The detailed review of a potential venture capital deal is called diligent research.

Accepted Answer

A) True 
 B)False

Question 12

Financial ratios are control mechanisms to test the financial strengths of a new venture.

Accepted Answer

A) True 
 B)False

Question 13

SBIC firms are small companies with some government money that invest in other companies.

Accepted Answer

A) True 
 B)False

Question 14

The informal investment market contains the smallest pool of risk capital in the United States.

Accepted Answer

A) True 
 B)False

Question 15

Venture capitalists view going public a highly disadvantageous step since the level of risks involved substantially increase.

Accepted Answer

A) True 
 B)False

Question 16

The best source of funds for first-stage financing is the venture-capital market.

Accepted Answer

A) True 
 B)False

Question 17

In 2017,venture capital dollars were concentrated in the following three industries: internet,health care,and business products and services.

Accepted Answer

A) True 
 B)False

Question 18

Venture capitalists tend to avoid investment proposals that are referred from lawyers and accountants.

Accepted Answer

A) True 
 B)False

Question 19

The securities of certain smaller companies going public must also be qualified under international blue-sky laws.

Accepted Answer

A) True 
 B)False

Question 20

List three reasons why an informal investor,or a business angel,may reject a proposal.

Accepted Answer

• Risk/return ratio not adequate
• Inade

Going private is a form of acquisition and leverage buyout financing.

Which of the following statements about the demographic patterns of informal investors is not true

The underwriting syndicate is a group of firms involved in selling stock to the public.

In most cases,the venture capitalist:

________ is the form of the transaction when money is obtained by a company.

Going public:

Identify the main advantages and disadvantages of going public.

The securities of certain smaller companies going public must also be qualified under the ________ of each state where the securities will be offered.

The shorter the time before a company goes public,given that profits and sales growth occur,the less percentage of equity the entrepreneur will have to give up per dollar invested.

Included in the guidelines for dealing with venture capitalists,the entrepreneur should:

The detailed review of a potential venture capital deal is called diligent research.

Financial ratios are control mechanisms to test the financial strengths of a new venture.

SBIC firms are small companies with some government money that invest in other companies.

The informal investment market contains the smallest pool of risk capital in the United States.

Venture capitalists view going public a highly disadvantageous step since the level of risks involved substantially increase.

The best source of funds for first-stage financing is the venture-capital market.

In 2017,venture capital dollars were concentrated in the following three industries: internet,health care,and business products and services.

Venture capitalists tend to avoid investment proposals that are referred from lawyers and accountants.

The securities of certain smaller companies going public must also be qualified under international blue-sky laws.

List three reasons why an informal investor,or a business angel,may reject a proposal.

The Entrepreneurial Mind-Set

Corporate Entrepreneurship

Generating and Exploiting New Entries

Creativity and the Business Idea

Identifying and Analyzing Domestic and International Opportunities

Protecting the Idea and Other Legal Issues for the Entrepreneur

The Business Plan: Creating and Starting the Venture

The Marketing Plan

The Organizational Plan

The Financial Plan

Sources of Capital

Strategies for Growth and Managing the Implication of Growth

Accessing Resources for Growth From External Sources

Succession Planning and Strategies for Harvesting and Ending the Venture

Filters

Exam 12: Informal Risk Capital, Venture Capital, and Going Public

Going private is a form of acquisition and leverage buyout financing.

Which of the following statements about the demographic patterns of informal investors is not true

The underwriting syndicate is a group of firms involved in selling stock to the public.

In most cases,the venture capitalist:

________ is the form of the transaction when money is obtained by a company.

Going public:

Identify the main advantages and disadvantages of going public.

The securities of certain smaller companies going public must also be qualified under the ________ of each state where the securities will be offered.

The shorter the time before a company goes public,given that profits and sales growth occur,the less percentage of equity the entrepreneur will have to give up per dollar invested.

Included in the guidelines for dealing with venture capitalists,the entrepreneur should:

The detailed review of a potential venture capital deal is called diligent research.

Financial ratios are control mechanisms to test the financial strengths of a new venture.

SBIC firms are small companies with some government money that invest in other companies.

The informal investment market contains the smallest pool of risk capital in the United States.

Venture capitalists view going public a highly disadvantageous step since the level of risks involved substantially increase.

The best source of funds for first-stage financing is the venture-capital market.

In 2017,venture capital dollars were concentrated in the following three industries: internet,health care,and business products and services.

Venture capitalists tend to avoid investment proposals that are referred from lawyers and accountants.

The securities of certain smaller companies going public must also be qualified under international blue-sky laws.

List three reasons why an informal investor,or a business angel,may reject a proposal.

The Entrepreneurial Mind-Set

Corporate Entrepreneurship

Generating and Exploiting New Entries

Creativity and the Business Idea

Identifying and Analyzing Domestic and International Opportunities

Protecting the Idea and Other Legal Issues for the Entrepreneur

The Business Plan: Creating and Starting the Venture

The Marketing Plan

The Organizational Plan

The Financial Plan

Sources of Capital

Strategies for Growth and Managing the Implication of Growth

Accessing Resources for Growth From External Sources

Succession Planning and Strategies for Harvesting and Ending the Venture

Filters