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:

Pre-Qualified

The state of having been evaluated and deemed eligible for something, such as a loan or service, based on preliminary criteria.

Mass Affluent

Individuals with a significant amount of disposable income, though not wealthy by traditional standards, making them a target for certain luxury goods and financial services.

80/20 Rule

A theory that suggests that 20 percent of heavy users account for 80 percent of the total demand.

Heavy Users

Consumers who use or purchase a product or service much more frequently than average users.