Bank Debt Is Not a Realistic Source of Financing for Start-Ups

question 22

Multiple Choice

Bank debt is not a realistic source of financing for start-ups due to all of the following reasons except?

• A) a large portion of the assets are intangible and provide no collateral
• B) payables either don't yet exist or its history is inadequate
• C) the start-up's dependence on a small number of irreplaceable people is not a good match to demand deposits or other bank liabilities
• D) receivables collection track record is incomplete
• E) in the event of a default, it is now plausible for the bank to install a management team to help right the operations

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Definitions:

Bateman's Principle

A concept in sexual selection that suggests males have greater variance in reproductive success than females due to their investment in mating.

Reproductive Variance

Reproductive variance refers to the variation in reproductive success among individuals within a population.

Eyespots

Markings found on the bodies of some animals, resembling eyes, thought to deter predators or attract mates.

Marion Petrie

A researcher known for her work on sexual selection, particularly regarding the role of peacock tail feathers in attracting mates.