You Founded Your Own Firm Three Years Ago

question 82

Multiple Choice

You founded your own firm three years ago. You initially contributed $200,000 of your own money and in return you received 3 million shares of stock. Since then, you have sold an additional 2 million shares of stock to angel investors. You are now considering raising capital from a venture capital firm. This venture capital firm would invest $5 million and would receive 4 million newly issued shares in return. Suppose you sold the 2 million shares to the angel investor for $500,000. What was your percentage ownership in the company immediately following the angel investor's investment?

• A) 50%
• B) 40.0%
• C) 60.0%
• D) 100%

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Definitions:

Air Brake Circuit

An arrangement of components including air tanks, hoses, valves, and actuators, designed to operate brakes using compressed air.

Slack Adjusters

Components in a vehicle's brake system that adjust the brakes as they wear, ensuring consistent braking performance.

S-Cams

Components used in drum brakes, shaped like an "S", which turn and push brake shoes out against the drum to stop a vehicle.

Linear Force

A force that acts in a straight line, applying push or pull in a single direction to move or support objects.