What Is a Liquidity Event

question 15

Multiple Choice

What is a liquidity event?

• A)The second part of the harvest strategy
• B)The way in which a manager plans to add in more liquid assets
• C)The way in which a manager plans to close out other investors
• D)The way in which an investor plans to close out an investment; also known as an exit strategy

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Definitions:

Investors

Investors are individuals or entities that allocate capital with the expectation of receiving a financial return, often through the purchase of stocks, bonds, or real estate.

Trade-off

The concept of sacrificing one good or service to purchase or produce another.

Business Risk

The potential for financial loss or failure inherent in the operation of a business, influenced by market, industry, and internal factors.

Firm's Profits

The financial gain made by a company after deducting all expenses, costs, and taxes from its total revenue.