Statements about venture capital is false-project life cycle

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Reference no: EM132264839

1. Which of the following statements about venture capital is false?

Entrepreneurs raise venture capital by selling shares of ownership in their business.

Venture capital is a form of public equity financing.

Venture capital groups can often provide helpful management advice.

Venture capital is used to finance rapid growth or large capital expenditures.

2. In addition to an annual base salary of 1.3 million USD and 10.4 million USD in stock compensation and bonuses, Heather Bresch, CEO of Mylan Pharmaceuticals, also received 6.4 million USD in other compensation in 2015. This included 19,200 USD for the use of a company-provided automobile and 310,000 USD in personal use of the company jet. Which of the following statements is true regarding this situation?

Top level managers always act in the shareholder interest.

Shareholders favor diversification.

Top level managers may pursue their own interests over that of the company.

Executives favor diversification.

3. Which of the following is not included in a project life cycle:

Feasibility analysis

Planning

Maturity

Incubation

Alternative generation

4. A year after Fail Corp. was formed, the company held an operational meeting. At that meeting, a group of employees confronted the CEO regarding the company’s continuing viability. The employees were concerned that the company might be sold or merge with another company, and they would be at risk for losing their employment without much (or any) notice. The CEO of the company, in an effort to quell the employees’ concerns and induce them to stay, promised that “in the event of sale or merger of Fail Corp., any original employees still remaining with Fail Corp. would get 10% of the value of any sale or merger.” Fail Corp was acquired by a competitor 6 months later. At the time of acquisition, Fail Corp. refused to honor the CEO’s promise and the employees’ brought an action against Fail Corp. (and the acquiring company) for breach of contract.

Which of the following is correct?

a. In a bilateral contract, there are mutual promises between two parties to the contract, but only one party is the promisor and only one party is the promisee.

b. In a unilateral contract, there are mutual promises between two parties to the contract and each party is both a promisor and promisee.

c. Almost all unilateral contracts begin as illusory promises.

d. In a unilateral contract, an offeror offers a promise and seeks in exchange a return promise.

e. None of the above.

Reference no: EM132264839

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