Bankruptcy

question 117

Multiple Choice

Bankruptcy

• A)should be used only when one is legally forced to do so.
• B)should only be used for small,private firms.
• C)should only be used for large firms.
• D)should never be used as a strategy.
• E)can be an effective type of retrenchment strategy.

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Definitions:

Lock-up

A period post-initial public offering (IPO) during which shareholders are restricted from selling their shares.

Hedge Funds

Investment funds that employ diverse, and often more complex, strategies than traditional mutual funds, including the use of leverage, derivatives, and short selling to generate returns.

Mutual Funds

Investment programs funded by shareholders that trade in diversified holdings and are professionally managed.

Maintenance Margin

The minimum equity an investor must maintain in a margin account after the purchase has been made, to keep the position open.