Before Its IPO, Facebook Was an Example of a Private

question 39

Multiple Choice

Before its IPO, Facebook was an example of a private firm.As a private firm, Facebook was

• A)not subject to government regulations and taxation.
• B)run by stockholders and a board of directors.
• C)run by its founder, Mark Zuckerberg.
• D)not legally allowed to raise funds through venture capital firms.

Distinguish between different types of market efficiency and their implications for investors.

Calculate and interpret the real rate of return and its relationship with inflation.

Understand the relationship between risk and return and the concept of a risk premium.

Comprehend the calculation and interpretation of the geometric and arithmetic average returns.

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