Use the Information for the Question(s) Below

question 49

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.
-Suppose you sold the 1 million shares to the angel investor for $500,000. What was the post-money valuation of your shares immediately following the angel investor's investment?

• A) $500,000
• B) $2.5 million
• C) $1.0 million
• D) $2.0 million

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Definitions:

Statistical Analyses

The techniques used to interpret, describe, and make inferences from data sets, often involving mathematical calculations.

Inductive Reasoning

A method of reasoning in which general conclusions are drawn from specific observations or instances.

Probabilistic Conclusions

Inferences or outcomes derived from reasoning that incorporate the principles of probability, often used in scenarios where outcomes are uncertain.

Empirical Arguments

Arguments based on observed and recorded evidence.