An Entrepreneur Founded His Company Using $200,000 of His Own

question 14

Multiple Choice

An entrepreneur founded his company using $200,000 of his own money,issuing himself 200,000 shares of stock.An angel investor bought an additional 100,000 shares for $200,000.The entrepreneur now sells another 400,000 shares of stock to a venture capitalist for $1 million.What is the post-money valuation of the company?

• A)$1,000,000
• B)$1,140,000
• C)$1,750,000
• D)$2,000,000

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Definitions:

Defamatory Speech

Defamatory speech involves making false statements about someone that could harm their reputation or standing in the community.

First Amendment

A change to the U.S. Constitution that safeguards rights related to religious practices, speech, gathering, and the ability to petition.

Rational-basis Test

A standard of review used by courts to evaluate government statutes and regulations, where the law is presumed constitutional as long as it is rationally related to a legitimate government interest.

Commerce Clause

The Commerce Clause refers to a provision in the United States Constitution that grants Congress the power to regulate commerce with foreign nations, among the several states, and with the Indian tribes.