A Liquidity Event Accomplishes Which of the Following Purposes

question 75

Multiple Choice

A liquidity event accomplishes which of the following purposes?

• A) Provides a business sufficient funding to operate for up to a year without raising additional funding
• B) Provides the founders of a firm a salary
• C) Converts some or all of a company's stock to cash
• D) Allows the founders of a firm to sell stock to the public
• E) Allows a business to liquidate in an ethical and cost-effective manner

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Definitions:

Renegotiate

The process of revising the terms of an existing agreement or contract.

Pay Out

The process of disbursing or distributing money from a fund or account, commonly related to dividends by corporations, insurance claims, or winnings.

Insured Premium

The amount paid periodically to an insurance company for coverage, which guarantees compensation for specific potential losses.

Event Occurs

A moment or situation that takes place, typically triggering a specific reaction or process in a legal, contractual, or social context.