________ Provide Financing to New or Emerging Companies with High

question 205

Multiple Choice

________ provide financing to new or emerging companies with high profit potential. In return, these organizations expect a share of ownership in the company.

• A) Commercial banks
• B) Venture capital firms
• C) Federal Reserve banks
• D) Investment bankers

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Definitions:

Transaction Costs

Expenses incurred when buying or selling goods or services, including fees, charges, and other costs associated with the transfer of assets.

Exchange

The act of giving one thing and receiving another, especially of the same type or value, in return.

Disequilibrium

The condition that exists in a market when the plans of buyers do not match those of sellers; a temporary mismatch between quantity supplied and quantity demanded as the market seeks equilibrium

Government Intervention

Actions taken by a government to influence or regulate various activities in its economy, which can include fiscal policy, monetary policy, tariffs, and regulation.