Question 1

Which of the following statement is (are)true?

Accepted Answer

A) Rule 505 permits the sale of $10 million of unregistered securities in the private offering in any 12-month period. 
B) Rule 504 and 505 permit no general advertising or solicitation through public media. 
C) Rule 506 provides the first exemption to a company seeking to raise a small amount of capital from numerous investors. 
D) The entrepreneur issuing the private offering is spared the burden of proving that the exemptions granted have been met. 
A) Rule 505 permits the sale of $10 million of unregistered securities in the private offering in any 12-month period. 
B) Rule 504 and 505 permit no general advertising or solicitation through public media. 
C) Rule 506 provides the first exemption to a company seeking to raise a small amount of capital from numerous investors. 
D) The entrepreneur issuing the private offering is spared the burden of proving that the exemptions granted have been met.

Question 2

A bank may finance up to ______ of a company's accounts receivable.

Accepted Answer

A) 50% 
B) 60% 
C) 70% 
D) 80% 
A) 50% 
B) 60% 
C) 70% 
D) 80%

Question 3

Private offerings:

Accepted Answer

A) must comply with Regulation D. 
B) involve more time and expense than public offerings. 
C) do not involve the SEC. 
D) are not a viable option for new ventures. 
A) must comply with Regulation D. 
B) involve more time and expense than public offerings. 
C) do not involve the SEC. 
D) are not a viable option for new ventures.

Question 4

A short-term,internal source of funds can be obtained by reducing short-term assets such as inventory,cash,and other working-capital items.

Accepted Answer

A) True 
 B)False

Question 5

A "commitment fee" is used in arranging for a:

Accepted Answer

A) commercial loan. 
B) character loan. 
C) installment loan. 
D) line of credit. 
A) commercial loan. 
B) character loan. 
C) installment loan. 
D) line of credit.

Question 6

SBA 7(a)loans can be used for such things as equipment and land.

Accepted Answer

A) True 
 B)False

Question 7

The most popular means of obtaining capital is from friends and family.

Accepted Answer

A) True 
 B)False

Question 8

Which of the following is not a form of cash flow financing?

Accepted Answer

A) Trust receipt 
B) Character loan 
C) Line of credit 
D) Installment loan 
A) Trust receipt 
B) Character loan 
C) Line of credit 
D) Installment loan

Question 9

__________ financing involves using any possible methods for conserving cash.

Accepted Answer

A) Bootstrapping 
B) SBIR 
C) Private placement 
D) Floor planning 
A) Bootstrapping 
B) SBIR 
C) Private placement 
D) Floor planning

Question 10

When using equity financing from family and friends:

Accepted Answer

A) business arrangements should be in good faith. 
B) details such as terms of the investment and rights of the investor need not be in writing. 
C) they can be more patient than other investors in when they expect a return on investment. 
D) since the amount of money is usually small,they do have an ownership position in the venture. 
A) business arrangements should be in good faith. 
B) details such as terms of the investment and rights of the investor need not be in writing. 
C) they can be more patient than other investors in when they expect a return on investment. 
D) since the amount of money is usually small,they do have an ownership position in the venture.

Question 11

The SBA's 7(a)Loan Guarantee program helps qualified small businesses obtain financing when they can't get a business loan through regular lending channels.

Accepted Answer

A) True 
 B)False

Question 12

Mortgage financing is another term for:

Accepted Answer

A) large equipment asset-based financing. 
B) real-estate asset-based financing. 
C) sale-leaseback financing. 
D) unsecured financing. 
A) large equipment asset-based financing. 
B) real-estate asset-based financing. 
C) sale-leaseback financing. 
D) unsecured financing.

Question 13

The Small Business 7(a)Guaranty program:

Accepted Answer

A) guarantees up to 50 percent of the amount loaned. 
B) helps qualified small businesses obtain financing when they cannot obtain it through regular lending channels. 
C) has a maximum loan amount of $10 million. 
D) loans can be used only for machinery and equipment,and land and building. 
A) guarantees up to 50 percent of the amount loaned. 
B) helps qualified small businesses obtain financing when they cannot obtain it through regular lending channels. 
C) has a maximum loan amount of $10 million. 
D) loans can be used only for machinery and equipment,and land and building.

Question 14

The asset base for loans usually is accounts receivable,inventory,equipment,and real estate.

Accepted Answer

A) True 
 B)False

Question 15

The personal funds of the entrepreneur are the most expensive.

Accepted Answer

A) True 
 B)False

Question 16

The most frequently used source of short-term funds when collateral is available is:

Accepted Answer

A) SBA Microloans. 
B) SBA 7(a)loans. 
C) R&D limited partnerships. 
D) commercial bank loans. 
A) SBA Microloans. 
B) SBA 7(a)loans. 
C) R&D limited partnerships. 
D) commercial bank loans.

Question 17

The funds for a SBA guaranteed loan are provided by the federal government.

Accepted Answer

A) True 
 B)False

Question 18

The maximum amount that can be borrowed under an SBA 7(a)loan is:

Accepted Answer

A) $750,000 
B) $1,000,000 
C) $1,500,000 
D) $5,000,000 
A) $750,000 
B) $1,000,000 
C) $1,500,000 
D) $5,000,000

Question 19

Trust receipts are inventory loans used to finance floor plans of retailers such as automobile dealers.

Accepted Answer

A) True 
 B)False

Question 20

The costs of establishing R&D limited partnerships are greater than conventional financing.

Accepted Answer

A) True 
 B)False

Which of the following statement is (are)true?

A bank may finance up to ______ of a company's accounts receivable.

Private offerings:

A short-term,internal source of funds can be obtained by reducing short-term assets such as inventory,cash,and other working-capital items.

A "commitment fee" is used in arranging for a:

SBA 7(a)loans can be used for such things as equipment and land.

The most popular means of obtaining capital is from friends and family.

Which of the following is not a form of cash flow financing?

__________ financing involves using any possible methods for conserving cash.

When using equity financing from family and friends:

The SBA's 7(a)Loan Guarantee program helps qualified small businesses obtain financing when they can't get a business loan through regular lending channels.

Mortgage financing is another term for:

The Small Business 7(a)Guaranty program:

The asset base for loans usually is accounts receivable,inventory,equipment,and real estate.

The personal funds of the entrepreneur are the most expensive.

The most frequently used source of short-term funds when collateral is available is:

The funds for a SBA guaranteed loan are provided by the federal government.

The maximum amount that can be borrowed under an SBA 7(a)loan is:

Trust receipts are inventory loans used to finance floor plans of retailers such as automobile dealers.

The costs of establishing R&D limited partnerships are greater than conventional financing.

Entrepreneurship and the Entrepreneurial Mind-Set

Entrepreneurial Intentions and Corporate Entrepreneurship

Entrepreneurial Strategy: Generating and Exploiting New Entries

Creativity and the Business Idea

Identifying and Analyzing Domestic and International Opportunities

Intellectual Property and Other Legal Issues for the Entrepreneur

The Business Plan: Creating and Starting the Venture

The Marketing Plan

The Organizational Plan

The Financial Plan

Informal Risk Capital, venture Capital, and Going Public

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 11: Sources of Capital

Which of the following statement is (are)true?

A bank may finance up to ______ of a company's accounts receivable.

Private offerings:

A short-term,internal source of funds can be obtained by reducing short-term assets such as inventory,cash,and other working-capital items.

A "commitment fee" is used in arranging for a:

SBA 7(a)loans can be used for such things as equipment and land.

The most popular means of obtaining capital is from friends and family.

Which of the following is not a form of cash flow financing?

__________ financing involves using any possible methods for conserving cash.

When using equity financing from family and friends:

The SBA's 7(a)Loan Guarantee program helps qualified small businesses obtain financing when they can't get a business loan through regular lending channels.

Mortgage financing is another term for:

The Small Business 7(a)Guaranty program:

The asset base for loans usually is accounts receivable,inventory,equipment,and real estate.

The personal funds of the entrepreneur are the most expensive.

The most frequently used source of short-term funds when collateral is available is:

The funds for a SBA guaranteed loan are provided by the federal government.

The maximum amount that can be borrowed under an SBA 7(a)loan is:

Trust receipts are inventory loans used to finance floor plans of retailers such as automobile dealers.

The costs of establishing R&D limited partnerships are greater than conventional financing.

Entrepreneurship and the Entrepreneurial Mind-Set

Entrepreneurial Intentions and Corporate Entrepreneurship

Entrepreneurial Strategy: Generating and Exploiting New Entries

Creativity and the Business Idea

Identifying and Analyzing Domestic and International Opportunities

Intellectual Property and Other Legal Issues for the Entrepreneur

The Business Plan: Creating and Starting the Venture

The Marketing Plan

The Organizational Plan

The Financial Plan

Informal Risk Capital, venture Capital, and Going Public

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