What Are the Disadvantages of Distributing Founder Shares Equally Among

question 10

Multiple Choice

What are the disadvantages of distributing founder shares equally among all co-founders?

• A) The lack of a primary shareholder slows down the decision making process
• B) CEO may be doing as much work as CEOs of comparable companies, but have less potential upside
• C) Such distribution makes unwanted acquisitions easy
• D) A and B
• E) A and C

---

Definitions:

Option Price

The price at which the holder of an option can buy (call option) or sell (put option) the underlying asset.

Forward Price

The agreed-upon price for a financial transaction that will occur at a future date.

Settlement

The process of resolving a transaction, which in finance typically means the exchange of payment for goods or services.