Use the Information for the Question(s)below

question 2

Multiple Choice

Use the information for the question(s) below.
You founded your own firm three years ago.You initially contributed $200,000 of your own money and in return you received 2 million shares of stock.Since then,you have sold an additional 1 million shares of stock to angel investors.You are now considering raising capital from a venture capital firm.This venture capital firm would invest $5 million and would receive 2 million newly issued shares in return.
-Assuming that this is the venture capitalist's first investment in your firm,what percentage of the firm will you own?

• A)50%
• B)40%
• C)33%
• D)25%

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Definitions:

Federal Court System

The judiciary system of the United States, consisting of the Supreme Court, appellate courts, and district courts.

Commercial Treaties

Agreements between countries that govern the terms of trade, investment, and economic relations.

Founders

Refers to the individuals who played a significant role in establishing an institution, nation, or organization, often used in the context of the founding fathers of the United States.

Philosophical Principles

Fundamental truths or propositions that serve as the foundation for a system of belief or behavior or for a chain of reasoning.