ENGRI_127_Quiz__10_answers - ENGRI 127 Quiz Name_ Week of...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
ENGRI 127 Quiz Name_____________________________________ Week of April 28, 2008 Quiz #10 Multiple Choice. Circle the letter of the best answer. 1. When a high-tech company is going through the start-up phase, typical sources of financing include all but which of the following. a. second mortgages b. private equity c. friends and family d. commercial bank loans 2. An advantage of debt financing is a. regular interest payments. b. bankruptcy. c. inhibition of growth and development. d. retention of ownership. 3. Equity capital is a. paid back within one year. b. paid back after five years. c. not a loan but a form of stock. d. all of the above. 4. One of the disadvantages of taking a company public in an initial public offering is a. liquidity for investors b. ease of acquiring capital c. growth opportunity d. required compliance with Sarbanes-Oxley 5. A disadvantage of funding a company’s growth using equity capital is: a. founders will own a smaller percentage of the company as investors purchase shares. b. it has a negative connotation in the media. c. the company will encounter higher tax rates d. greater environmental regulations will be enforced. 6. One of the disadvantages of bootstrapping is: a. Growth rates may be constrained by the lack of capital b. The founders retain 100% ownership of the company c. Tax-wise, there are problems d. Bootstrapping is not strictly legal in the USA
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
7. Bootstrapping is best suited to businesses with a. Little or no profit margin, to encourage the entrepreneur to work hard
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 4

ENGRI_127_Quiz__10_answers - ENGRI 127 Quiz Name_ Week of...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online