Which of the Following Statements Is NOT True Regarding Angel

question 40

Multiple Choice

Which of the following statements is NOT true regarding Angel Investors?

• A)They are typically arranged as limited partnerships.
• B)For many start-ups,the first round of outside private equity financing is often obtained from them.
• C)Because their capital investment is often large relative to the amount of capital already in place at the firm,they typically receive a sizeable equity share in the business in return for their funds.
• D)These investors are frequently friends or acquaintances of the entrepreneur.

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Definitions:

Par Value

The face value of a bond or stock as stated by the issuing company, which is not indicative of its market value.

Consideration Transferred

The total amount of assets, liabilities, or equity given by an acquiring firm to obtain control of an acquired firm during a merger or acquisition.

Acquisition Business Combination

The process where one company takes over another and clearly establishes itself as the new owner, resulting in a consolidation of assets and liabilities under a single entity.

Common Stock

Ownership of shares in a corporation that provides the owners with voting rights and entitlement to a portion of the company's profits through dividends.