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%

Understand the components and calculation of bond prices including invoice price, clean price, and yield to maturity.

Analyze the effect of changing yield rates on bond prices over different maturity periods.

Calculate the market price of bonds given various coupon rates, face values, yields, and maturity dates.

Understand the concept of zero-coupon bonds and calculate their purchase price and yield.

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Definitions:

Covenants

Legally enforceable agreements or promises within a deed or contract, often related to the use of land or property.

Standard of Living

A level of wealth, comfort, material goods, and necessities available to a certain socioeconomic class or geographic area.