Intro to Business Quiz 3

Office furniture

When launching a business, there is typically a large number of startup costs (including both startup expenses and startup assets). Which of the following is an example of a start-up asset?

Angle Investors

Which of the following are most likely to invest their own money in high-growth companies at early stages of development rather than established, stable, low-growth businesses?

Family/Friends and Personal

Which of the following funding sources accounts for more than 2/3 of all money invested in new small business?

Paying dividends (distribution)

Which of the following is NOT a common way that organizations raise the funding they need?

C. All of the above

Which of the following is commonly required when applying for a Small Business Administration (SBA) loan? A. Business plans B. Income tax returns C.All of the above D. Financial statements E. Credit reports

Financial managers try to balance cost and risk when selecting the best combination of long-term debt (borrowing) and equity (ownership)

Which of the following is true regarding long-term loans?

B. All of the above

Which of the following is true regarding short-term loans? A.They are used to finance current assets and support operations B. All of the above C. They can be unsecured or secured loans D. They are shown as a current liability on the balance sheet E. They are typically due within one year

E. Financing options depend on a variety of business factors, so the funding search and approach should be tailored accordingly

Which of the following is true regarding the financing of a new business? A. All of the above B. While established businesses have access to investment funding, startups have access to standard business loans from traditional banks C. Venture capital is a growing opportunity for funding businesses D. Investors are primarily concerned with the detail and specificity in the business plan; not necessarily the demonstrated early success of the business E. Financing options depend on a variety of business factors, so the funding search and approach should be tailored accordingly

A. All of the above

Which of the following statements is true regarding a business's cash balance on starting state? A. All of the above B. Cash requirements is an estimate of how much money your startup company needs to have in its checking account when it starts C. Your cash balance on starting date is calculated by your money raised minus the money you spent on expenses and assets D. Most new businesses take months to years from launch until reaching a steady-state break-even point (when revenues are equal to spending) E. To estimate your starting cash balance, you can calculate your projected early months' deficit spending until you reach a monthly break-even state

E. The SBA works with certified lenders, or banks, in guaranteeing loans for small businesses

Which of the following statements is true regarding the Small Business Administration (SBA)? A.SBA loans do not typically require that capital be supplied by the new business owner B. The SBA makes loans directly to small businesses and startups C. SBA loans typically offer short repayment terms with high interest rates D. All of the above E. The SBA works with certified lenders, or banks, in guaranteeing loans for small businesses