Which of the Following Statements About Venture Capital Firms Is

question 28

Multiple Choice

Which of the following statements about venture capital firms is FALSE?

• A) Venture capital firms get most of their capital from pension funds, large university endowments, and other institutions that can take substantial risks with a small portion of their funds.
• B) Most start-up companies that acquire venture capital eventually turn out to be successes.
• C) Venture capital firms invest in high-risk, high-potential firms.
• D) Companies that acquire their funds from venture capital firms may initially have trouble acquiring capital from other channels.

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Definitions:

Cash Account

A cash account is a business or brokerage account that requires the account holder to pay the full amount for securities purchased.

Debiting

The process of recording an entry on the left side of the accounting ledger, indicating an increase in assets or expenses, or a decrease in liabilities, equity, or income.

Consuming Goods

Goods that are used by consumers and are typically expended when used, opposed to durable goods which are designed to last for a prolonged period.

Generating Revenues

Generating revenues refers to the process through which a business earns money by selling goods or providing services.