All of the Following Are Reasons for New Start-Up Businesses

question 44

Multiple Choice

All of the following are reasons for new start-up businesses being under-funded except

• A) entrepreneurs underestimate the value of establishing bank credit.
• B) entrepreneurs use trade credit ineffectively.
• C) entrepreneurs fail to consider venture capital as a source of funding.
• D) entrepreneurs are notorious for not planning cash flow properly.
• E) entrepreneurs rely too much on equity financing and not enough on debt financing.

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Definitions:

M1 Definition

A category of the money supply that includes all physical money like coins and currency, as well as demand deposits, and other liquid assets that can be quickly converted to cash.

Medium of Exchange

A facilitative tool employed to assist in the buying, selling, or exchanging of products among individuals or groups.

Money Supply

The full amount of financial resources at an economy's disposal, including cash, coins, and the amounts in checking and savings accounts, at a particular moment.

Financial Intermediaries

Organizations that facilitate the channeling of funds between savers and borrowers, including banks, credit unions, and insurance companies.