Which One of the Following Statements Concerning Venture Capitalists Is

question 51

Multiple Choice

Which one of the following statements concerning venture capitalists is correct?

• A)Venture capitalists assume management responsibility for the firms they finance.
• B)Exit strategy is a key consideration when selecting a venture capitalist.
• C)Venture capitalists limit their services to providing money to start-up firms.
• D)Most venture capitalists are long-term investors in a firm.
• E)A venture capitalist normally invests in a new idea and finances that idea until the newly-formed firm can issue an IPO.

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Definitions:

Real-World Observations

Empirical data or evidence gathered from the real world, used to inform or support research, theories, and decision-making.

Positive Accounting Theory

A theory that explains why firms elect certain accounting practices based on hypotheses about management behavior.

Ownership

The state or fact of exclusive rights and control over property, which can be an object, land/property, or intellectual property.

Control

In the context of business, control refers to the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities, often achieved through ownership of more than half of the voting rights or otherwise.