Ch. 09, ENT 396 CH. 8, ENT Test 3 Review
ch 8
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ch 9
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Which is an important question for the entrepreneur to ask when evaluating the venture capitalist? a. Is the person a close relative? b. Is the person wealthy? c. Is the person someone with whom the entrepreneur can work? d. Is the person a college graduate?
Is the person someone with whom the entrepreneur can work?
Which of the following is not a type of debt financing? a. trade credits b. accounts receivables c. private placement d. finance companies
private placement
A disadvantage of debt financing is a. relinquishment of ownership. b. inhibition of growth and development due to equity investments. c. regular interest payments. d. possible cash flow enhancement.
regular interest payments.
Advantages of debt financing include all of the following except: a. low interest rates that justify the opportunity cost. b. regular interest payments. c. potential greater return on equity. d. no relinquishment of ownership.
regular interest payments.
(T/F) Informal risk capitalists are often referred to as "business angels."
True
(T/F) Informal risk capitalists are those who have already made their money and now seek to help new ventures.
True
(T/F) Private placement is a method of raising capital through the private placement of securities.
True
(T/F) Sophisticated investors are wealthy individuals who invest more or less regularly in new and/or early- and late-stage ventures.
True
(T/F) Sources of debt financing include trade credit, accounts receivables, factoring, and finance companies.
True
(T/F) Use of debt to finance a new venture involves a payback of funds plus an interest fee for the use of the money.
True
Which is one of the most important questions for entrepreneurs to ask regarding venture capitalists? a. What is it like to work with their firm? b. Are they wealthy? c. Are they good communicators? d. Are they good at financial computation?
What is it like to work with their firm?
A copyright provides exclusive rights to creative individuals for the protection of their artistic productions. a. True b. False
a
A trademark is a distinctive name, mark, or symbol that is identified with a company's product. a. True b. False
a
All of the following are ways of invalidating a trademark except a. clearing-out proceedings. b. abandonment. c. cleaning-out proceedings. d. generic meaning.
a
Because of the _____ doctrine, it is sometimes difficult to establish infringement. a. fair use b. freedom of information c. right to publish d. acquisition
a
One of the principal advantages of a corporate form of ownership is that liability (the most money a person can lose) is limited to an individual's investment. a. True b. False
a
The two parts of a patent application are specification and claims. a. True b. False
a
There are two parts to a patent application, claims and a. specification. b. percentage. c. integration. d. value.
a
Three primary legal forms of organization are the sole proprietorship, the partnership, and the corporation. a. True b. False
a
To effectively pursue a patent violation, experts recommend that the entrepreneur a. prepare a realistic budget for infringement. b. handle all matters personally. c. sue as quickly as possible. d. fill out a preprinted form obtained from a patent office.
a
When considering bankruptcy, entrepreneurs as sole proprietors normally prefer a. Chapter 13. b. Chapter 5. c. Chapter 7. d. Chapter 11
a
Works created and copyrighted after January 1, 1978, are protected for the life of the author plus 70 years. a. True b. False
a
An informal risk capitalist is referred to as: a. a business angel. b. your neighbor. c. someone with extra money to invest but who is not interested becoming an entrepreneur. d. a retiree.
a business angel.
Which of the following does not represent a category of angel investors? a. corporate angels b. amateur angels c. micromanagement angels d. entrepreneurial angels
amateur angels
The entrepreneur should ask the venture capitalist _____ questions. a. exactly twenty b. an unlimited number of c. no d. at most ten
an unlimited number of
Chapter 7, Chapter 9, and Chapter 11 are the most common forms of bankruptcy. a. True b. False
b
From where does an S corporation take its name? a. Uniform Commercial Code b. Subchapter S of the Internal Revenue Code c. state law d. S Lab
b
It often is possible to obtain more capital and a better range of skills in a sole proprietorship than in a partnership. a. True b. False
b
Laws governing intellectual property rights include copyrights, trademarks, and leases. a. True b. False
b
The registration of a trademark lasts for 40 years, with continuous renewal every 10 years. a. True b. False
b
Which of the following are not trademarks? a. mottos b. generic words c. symbols d. names
b
Which of the following falls under Chapter 7 bankruptcy? a. The debtor surrenders most property to a court trustee. b. The debtor is relieved of obligations. c. The debtor fails to file income taxes. d. The debtor is arrested.
b
Works created after January 1, 1978, have a copyright for the life of the author plus a. 14 years. b. 70 years. c. 10 months. d. 50 years.
b
All of the following are recognized as advantages of partnerships except: a. direct rewards b. possible tax advantages c. lack of continuity d. ease of formation
c
That part of a patent application which identifies the features that are protected is known as the a. particular. b. essence. c. claim. d. identification.
c
The owner of a copyright may do all of the following except a. perform the work publicly. b. reproduce the work. c. deduct the intrinsic value of the rights from one's taxes. d. display the work publicly.
c
The registration of a trademark has a lifetime of a. 25 years. b. the lifetime of the owner. c. 10 years plus 10-year renewable periods. d. 20 years plus 5-year renewable periods.
c
When a trademark becomes the name of a general group of products or services, the trademark protection may be lost because of a. cleaning-out procedure. b. abandonment. c. generic meaning. d. cancellation proceedings.
c
Specific forms of partnership include which of the following? a. limited partnerships b. S partnerships and limited liability companies c. limited partnerships and S partnerships d. limited partnerships and limited liability partnerships
d
Major trends in the venture capital field today include all of the following except a. emerging feeder funds b. less specialized and more homogenous funds c. decrease in start-up investment amounts d. global reach
less specialized and more homogenous funds
Which of the following statements is not true of venture capitalists? a. They take a long time to raise venture capital. b. They are interested in trying to manage firms themselves. c. They expect high return on investments. d. They want the entrepreneur and the management to run the company.
They are interested in trying to manage firms themselves.
One of the advantages of public offerings is a. requirements. b. cost. c. liquidity. d. disclosure.
liquidity.
The main objective of Regulation D is to a. reduce debt financing by small enterprises. b. make it easier and less expensive for small ventures to sell stock. c. increase investment in private placement. d. regulate new small-business investment.
make it easier and less expensive for small ventures to sell stock.
(T/F) Because the advantages of going public outweigh the disadvantages, it is in a corporation's best interest to go public.
False
(T/F) Equity financing is money invested in the venture with legal obligations to repay the principal amount of interest or interest rate on it.
False
(T/F) Regulation D augments the regulations for reports and statements required for selling stock to private parties, friends, employees, customers, relatives, local professionals.
False
(T/F) Venture capitalists, surprisingly, require little information before they make an investment.
False
The most common source of debt financing is a. factoring. b. commercial banks. c. trade credit. d. finance companies.
commercial banks.
Which of the following terms is not synonymous with social lending? a. peer-to-peer (P2P) lending b. commercially viable lending c. crowdfunding d. banking 2.0
commercially viable lending
Which of the following is a type of equity financing? a. loan with warrants b. common stock c. convertible debentures d. loan without warrants
common stock
