Venture Capital Firms Look to Invest Their Funds in Firms

question 177

Multiple Choice

Venture capital firms look to invest their funds in firms that

• A) operate in established, mature industries.
• B) present financial statements indicating stronger than average cash flows.
• C) are new with great profit potential.
• D) require extra funding to avoid financial difficulties.

---

Definitions:

Annuity Factor

A multiplier used to calculate the present value of an annuity, representing the sum of the present values of all future annuity payments.

Interest Rate

The percentage charged on the total amount of borrowed money or paid on invested capital.

Compounding Periods

The frequency with which interest is added to the principal balance of a financial instrument, affecting the total interest earned or paid over time.

Periodic Payments

Regular payments made over a determined period, such as monthly rent or mortgage payments.