Which of the Following Is NOT a Reason Why an Investor

question 84

Multiple Choice

Which of the following is NOT a reason why an investor would choose to invest in new and growing firms as a limited partner in a venture capital firm rather than making those investments directly by themselves?

• A) Venture capital firms use their control of the companies they invest in to protect those investments.
• B) The investments of venture capital firm are more diversified than the investments of a single individual.
• C) A venture capital firm generally has a wide range of expertise among its general partners.
• D) The investor will have a direct say in how the companies that the venture capital firm funds will be run.

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Definitions:

APR

APR, or Annual Percentage Rate, is the annual rate charged for borrowing or earned through an investment, inclusive of any fees or additional costs associated with the transaction.

Zero-Interest Financing

A financing arrangement where the borrower does not pay any interest on the borrowed amount, often used as a promotional strategy by retailers.

Monthly Payments

Regular payments made each month, often associated with loans or leases, intended to repay borrowed money plus any applicable interest.

Rate Of Interest

The percentage of an amount of money which is paid for its use for a specified time, often annually.