Which of the Following Statements Is FALSE

question 11

Multiple Choice

Which of the following statements is FALSE?

• A)Venture capitalists typically control about three-quarters of the seats on a start-up's board of directors, and often represent the single largest voting block on the board.
• B)The initial capital that is required to start a business is usually provided by the entrepreneur herself and her immediate family.
• C)Individual investors who buy equity in small private firms are called angel investors.
• D)A venture capital firm is a limited partnership that specialises in raising money to invest in the private equity of young firms.

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Definitions:

Interest Rate Risk

The risk that the value of an investment will decrease due to a change in interest rates.

Average Duration

The weighted average time it takes for an investor to receive all cash flows from a bond or a portfolio of bonds, factoring in the present value of those cash flows.

Perpetuity

A type of annuity that lasts forever, providing payments that continue indefinitely.

Yield

The income return on an investment, expressed as a percentage of the investment’s cost or current market value.