This quiz works best with JavaScript enabled. Home > Finance > Venture Capital > Venture Capital – Quiz 4 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Venture Capital Quiz 4 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. ..... works alone, while ..... are part of a company. A) Business angels, start-ups. B) Business angels, venture capitalist. C) Start-ups, business angels. D) Venture capitalist, business angels. Show Answer Correct Answer: B) Business angels, venture capitalist. 2. What is the suitable type of Private Equity (PE) investment for a company in the early growth stage? A) Startup financing. B) Expansion financing. C) Early growth financing. D) Seed financing. Show Answer Correct Answer: C) Early growth financing. 3. Factors that needed to build and develop a fund are ..... A) Government policies. B) Social and cultural values. C) Training and research capacity. D) Resources for venture capital. E) All are correct. Show Answer Correct Answer: E) All are correct. 4. During the preliminary due diligence stage of venture capital investment, what is a critical factor that investors often consider? A) The preference for investing in companies that have no competition. B) The emphasis on strong management over a strong business plan. C) Focusing only on companies that are creating new markets. D) The importance of having a detailed financial projection for the next 20 years. Show Answer Correct Answer: B) The emphasis on strong management over a strong business plan. 5. Edventure is a JA company and they sell A) Cases. B) Shirts. C) Caps. D) Cosmetics. Show Answer Correct Answer: C) Caps. 6. What is the exit strategy for venture capitalists? A) Sell equity stake through IPO or merger/acquisition. B) Liquidate all assets and distribute funds to shareholders. C) Sell equity stake through private placement. D) Hold onto the equity stake indefinitely. Show Answer Correct Answer: A) Sell equity stake through IPO or merger/acquisition. 7. Does Breakthrough Energy focus on fintech companies? A) NO. B) Yes. Show Answer Correct Answer: A) NO. 8. A firm that is specialized in financing young, start-up companies? A) Venture Capital. B) Finance company. C) Small-business finance company. D) Capital-creation company. Show Answer Correct Answer: A) Venture Capital. 9. What is the typical investment period for venture capital? A) 5 to 7 years. B) 10 to 15 years. C) 1 to 2 years. D) 20 to 25 years. Show Answer Correct Answer: A) 5 to 7 years. 10. What is Expansion Financing? A) Financing a company that has already started generating sales. B) Financing a company moving toward operation but prior to commercial production or sales. C) Financing an idea or research and development project that is very industry-oriented and risky. D) Financing the fastest growing companies in their market, with a proven business model and a well-established customer base. Show Answer Correct Answer: D) Financing the fastest growing companies in their market, with a proven business model and a well-established customer base. 11. What offer does Barbara have for the giant inflatable Christmas ornaments? A) She is offering a fair deal. B) She is not interested in their product. C) She wants to hear other offers before making her own. D) She is offering to partner with them. Show Answer Correct Answer: A) She is offering a fair deal. 12. If an organization wishes to venture into Insurance Business it has to obtain a licence first from which of the following? A) Indian Banks Association (IBA). B) Security and Exchange Board of India (SEBI). C) Tariff Advisory Committee (TAC). D) Insurance Regulatory and Development Authority of India (IRDAI). E) None of these. Show Answer Correct Answer: D) Insurance Regulatory and Development Authority of India (IRDAI). 13. In a typical venture capital portfolio, most of the returns are from 20% of the investments. This means that A) Statistically, if a venture capital makes ten investments, two will be winners and create most of the gains in the fund. B) 1 in 5 venture capital funds will succeed in its investments. C) 95% of investments made by venture capitalists fail, but 5 % make such spectacular returns that they subsidize the failures. D) The venture capital will always have one fifth of the votes in the companies' decisions. Show Answer Correct Answer: A) Statistically, if a venture capital makes ten investments, two will be winners and create most of the gains in the fund. 14. Which of the following is the best definition of venture capital? A) Investment from an established business into another business in return for shares. B) Investment of personal money by wealthy individuals. C) Money to buy machinery. D) Loans taken from wealthy businesses. Show Answer Correct Answer: A) Investment from an established business into another business in return for shares. 15. Transfer of risk to other party is done through ..... A) Reduction. B) Retention. C) Insurance. D) Control. Show Answer Correct Answer: C) Insurance. 16. Who are the individuals or entities that provide venture capital funding? A) Venture capitalists. B) Entrepreneurs. C) Government agencies. D) Banks. Show Answer Correct Answer: A) Venture capitalists. 17. PE/VC funds are the riskiest: A) Second tier funds. B) Mainstream funds. C) Mega funds. D) Niche funds. Show Answer Correct Answer: D) Niche funds. 18. Which stage of a business is typically funded by venture capital? A) Early stage. B) Mature stage. C) Exit stage. D) Growth stage. Show Answer Correct Answer: A) Early stage. 19. The differential profit of the CocaCola brand is 370 million, this brand has a strength of 85 points and the PER of the industry is 24. What is the value of the brand? A) 370. B) 8.880. C) 7.750. D) 7.548. Show Answer Correct Answer: D) 7.548. 20. True or false:venture capitalists cannot pull out the company until the company has gone public A) False. B) True. Show Answer Correct Answer: A) False. 21. The claim amount received from insurer are treated as ..... A) Reserve. B) Gains. C) TaxableGain. D) Nontaxable Income. Show Answer Correct Answer: C) TaxableGain. 22. Gatekeepers had to participate in transactions between the Private Equity fund and A) Pension fund and HNWI. B) Pension fund and hedge fund. C) HNWI and the central bank. D) None of above. Show Answer Correct Answer: A) Pension fund and HNWI. 23. What are some benefits that a venture-backed company can gain from Private Equity (PE) financing? A) Certification benefit, network benefit, knowledge benefit, and financial benefit. B) Liquidity benefit, network benefit, managerial benefit, and financial benefit. C) Debt benefit, network benefit, knowledge benefit, and financial benefit. D) Network benefit, knowledge benefit, certification benefit, and managerial benefit. Show Answer Correct Answer: A) Certification benefit, network benefit, knowledge benefit, and financial benefit. 24. Venture capital capitalists can earn A) A portion of the firm's equity. B) High returns. C) Small returns but influence on the company direction. D) High returns, a chunk of the company's equity as well as influence on the company decisions. Show Answer Correct Answer: D) High returns, a chunk of the company's equity as well as influence on the company decisions. 25. Angel investing in capital is typically provided in which stage of financing? A) Later-stage. B) Formative-stage. C) Mezzanine-stage. D) All stages. Show Answer Correct Answer: B) Formative-stage. 26. Which of the below is the best definition of Crowd Funding? A) Raising finance from professional investors. B) Raising finance from borrowing money. C) Raising finance from lots of small investors through a portal. D) Raising finance by selling assets. Show Answer Correct Answer: C) Raising finance from lots of small investors through a portal. 27. Transfer of rights and remedies of the insured to the insurer after indemnity has been effected is called ..... A) Money back policy. B) Proximate clause. C) Subrogation. D) Insurable interest. Show Answer Correct Answer: C) Subrogation. 28. Is the financial investment of the buy-out program of the Arca fund in the range of 5-20 million euros? A) Yes. B) NO. Show Answer Correct Answer: A) Yes. 29. Why can big VC firms risk losing money in their deals? A) Because sometimes you win, sometimes you lose. B) Because they can be covered by the big banks. C) Because investing in a successful start-up will make up for their loss. D) Because they will get high ROI. Show Answer Correct Answer: C) Because investing in a successful start-up will make up for their loss. 30. Surique is a JA company and they sell A) Cases. B) Socks. C) Shirts. D) Caps. Show Answer Correct Answer: A) Cases. ← PreviousNext →Related QuizzesFinance QuizzesVenture Capital Quiz 1Venture Capital Quiz 2Venture Capital Quiz 3Venture Capital Quiz 5Venture Capital Quiz 6 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books