Which of the Following Statements Is FALSE

question 32

Multiple Choice

Which of the following statements is FALSE?

• A)The general partners work for the venture capital firm and run the venture capital firm;they are called venture capitalists.
• B)An important consideration for investors in private companies is their exit strategy-how they will eventually realize the return from their investment.
• C)When a company founder decides to sell equity to outside investors for the first time,it is common practice for private companies to issue common stock rather than preferred stock to raise capital.
• D)Institutional investors such as pension funds,insurance companies,endowments,and foundations manage large quantities of money.

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Definitions:

Working Capital

The disparity between an organization's immediate assets and liabilities, revealing its short-term fiscal stability and operational effectiveness.

Short-Term Liabilities

Financial obligations of a business that are due to be paid within one year.

Spontaneously

Occurring without external cause, acting or done impulsively and without premeditation.

Firm's Operations

The day-to-day activities involved in running a business, including production, marketing, and sales functions.