Which of the Following Is a Reason Why an Investor

question 41

Multiple Choice

Which of the following is a reason why an investor would choose to invest in new and growing firms as a limited partner in a venture capital firm rather than making those investments directly by themselves?

• A)Venture capital firms use their control of the companies they invest in to protect those investments.
• B)The investments of venture capital firm are less diversified than the investments of a single individual.
• C)A venture capital firm generally has a narrow range of expertise among its general partners.
• D)The investor will have a direct say in how the companies that the venture capital firm funds will be run.
• E)The venture capital firm guarantees a higher return.

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