FIN 317 Complete Class - All Assignments. Midterm & Final ExamsClick Link Below To Get Entire Class:http://strtutorials.com/FIN-317-Complete-Class-All-Assignments-Midterm-Final-Exams-FIN3179.htm

FIN 317 Complete Class - All Assignments. Midterm & Final ExamsFIN 317 Assignment 1 - Business VentureFIN 317 Assignment 2 - The Basics of a StartUpFIN 317 Assignment 3 - More of the Basics and BeyondFIN 317 Assignment 4 - Financing an ExpansionFIN 317 WK 5 Midterm Exam - All Possible QuestionsFIN 317 WK 11 Final Exam Part 1 -All Possible QuestionsFIN 317 WK 11 Final Exam Part 2 -All Possible QuestionsFIN 317 Assignment 1 - Business VentureClick Link Below To Download:http://strtutorials.com/FIN-317-Assignment-1-Business-Venture-FIN3171.htmFIN 317 Assignment 1 - Business VentureYou are stepping into the world of becoming an entrepreneur. For this assignment, and the next three (3),pick an industry and a business you would like to own. This business must require the purchase of new orused equipment as an essential part of running the business (e.g., machine tooling, commercial stovetop, dry-cleaning equipment, or commercial printing equipment).Write a one (1) page paper in which you:1. Describe the industry and the type of business you plan to start. Provide specific details, such asthe location, type of customers, and closest or main competition.2. State why this type of business interests you.3. Indicate why you believe this business could be successful. Provide support for your rationale.Your assignment must follow these formatting requirements: Be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on allsides; citations and references must follow APA or school-specific format. Check with yourprofessor for any additional instructions. Include a cover page containing the title of the assignment, the students name, the professorsname, the course title, and the date. The cover page and the reference page are not included inthe required assignment page length.FIN 317 Assignment 2 - The Basics of a StartUpClick Link Below To Download:http://strtutorials.com/FIN-317-Assignment-2-The-Basics-of-a-StartUp-FIN3174.htmFIN 317 Assignment 2 - The Basics of a StartUpWrite a three to four (3-4) page paper in which you:1. Outline the financial start-up needs for this business. Consider such items as cash, equipment,space lease or purchase, raw materials, labor costs, etc. Provide a rationale for your estimates.(This is only a preliminary list. As you progress in the course, this outline will be fine-tuned.)2. Once you have estimated the start-up needs for this business, determine the best financingoptions to obtain the needed capital and how you would approach securing this type of financing.Justify your selection.More Details of the Question are hidden...FIN 317 Assignment 3 - More of the Basics and BeyondClick Link Below To Download:http://strtutorials.com/FIN-317-Assignment-3-More-of-the-Basics-and-Beyond-FIN3172.htmFIN 317 Assignment 3 - More of the Basics and BeyondThis assignment investigates the financial needs of your business venture from Assignment 1.Write a three to four (3-4) page paper in which you:1. Outline the financial start-up needs for this business. Consider such items as cash, equipment,space lease or purchase, raw materials, labor costs, etc. Provide a rationale for your estimates.(This is only a preliminary list. As you progress in the course, this outline will be fine-tuned.)2. Once you have estimated the start-up needs for this business, determine the best financingoptions to obtain the needed capital and how you would approach securing this type of financing.Justify your selection.More Details of the assignment are hidden...FIN 317 Assignment 4 - Financing an ExpansionClick Link Below To Download:http://strtutorials.com/FIN-317-Assignment-4-Financing-an-Expansion-FIN3173.htmFIN 317 Assignment 4 - Financing an ExpansionUsing the same business you started in Assignment 1, you will continue to build a financial plan for thebusiness.Write a four to five (4-5) page paper in which you:1. Prepare a pro forma balance sheet for the first twelve (12) months of your business. Include theassumptions on which it is based. Justify your balance sheet.2. Prepare a pro forma income statement for the first twelve (12) months of your business. Includethe assumptions on which it is based. Justify your income statement.3. Prepare a pro forma cash budget for the first twelve (12) months of your business. Include theassumptions that you have made when creating the budget. Justify your budget.More Details of the assignment are hidden...FIN 317 Final Exam Part 1 and Part 2 - All Possible QuestionsClick Link Below To Download:http://strtutorials.com/FIN-317-Final-Exam-Part-1-and-Part-2-All-Possible-Questions-FIN3178.htmFIN 317 Final Exam Part 1 and Part 2 - All Possible QuestionsTrue-False Questions 1. The accounting emphasis on accrued revenue and expenses and depreciation is the same emphasis as that of finance managers. 2. Traditional accounting does not focus on the implicit cost of equity that is the required capital gains to complement dividends. However, evaluation methods exist to determine this value by financial managers. 3. Formal historical accounting procedures include explicit records of debt (interest and principal) and dividend capital costs. 4. Public financial markets are markets for the creation, sale and trade of illiquid securities having less standardized negotiated features. 5. A ventures riskiness in terms of poor performance or failure is usually very high during the maturity stage of its life cycle. 6. A ventures riskiness in terms of poor performance or failure is usually high to moderate during the rapid-growth stage of its life cycle. 7. First-round financing during a ventures survival stage comes primarily from venture capitalists and investment banks. 8. Startup financing usually comes from entrepreneurs, business angels, and investment bankers. 9. Commercial banks provide liquidity-stage financing for ventures in the rapid-growth stage of their life cycles. 10. A ventures riskiness in terms of the likelihood of poor performance or failure decreases as it moves from its development stage through to its rapid-growth stage. 11. A nominal interest rate is an observed or stated interest rate. 12. The real interest rate (RR) is the interest one would face in the absence of inflation, risk, illiquidity, and any other factors determining the appropriate interest rate. 13. The risk-free interest rate is the interest rate on debt that is virtually free of inflation risk. 14. Inflation premium is the rising prices not offset by increasing quality of goods being purchased. 15. Default-risk is the risk that a borrower will not pay the interest and/or the principal on a loan. 16. The prime rate is the interest rate charged by banks to their highest default risk business customers. 17. Bond ratings reflect the inflation risk of a firms bonds. 18. The relationship between real interest rates and time to maturity when default risk is constant is called the term structure of interest rates. 19. The graph of the term structure of interest rates, which plots interest rates to time to maturity is called the yield curve. 20. Liquidity premiums reflect the risk associated with firms that possess few liquid assets. 21. Subordinated debt is secured by a ventures assets, while senior debt has an inferior claim to a ventures assets. 22. Early-stage ventures tend to have large amounts of senior debt relative to more mature ventures. 23. Investment risk is the chance or probability of financial loss on ones venture investment, and can be assumed by debt, equity, and founding investors. 24. A venture with a higher expected return relative to other ventures will necessarily have a higher standard deviation or returns. 25. Historically, large-company stocks have averaged higher long-term returns than small-company stocks 26. The coefficient of variation measures the standard deviation of a ventures return relative to its expected return. 27. Closely held corporations are those companies whose stock is traded over-the-counter. 28. Typically, the stocks of closely held corporations arent publicly traded. 29. Organized exchanges have physical locations where trading takes place, while the over-the-counter market is comprised of a network of brokers and dealers that interact electronically. 30. Market cap is determined by multiplying a firms current stock price by the number of shares outstanding.. 31. The excess average return of long-term government bonds over common stock is called the market risk premium. 32. The weighted average cost of capital is simply the blended, or weighted cost of raising equity and debt capital.Multiple-Choice Questions 1. Which of the following markets involve liquid securities with standardized contract features such as stocks and bonds? a. private financial market b. derivatives market c. commodities market d. real estate market e. public financial market 2. Which of the following markets involve direct two-party negotiations over illiquid, non-standardized contracts such as bank loans and direct placement of debt? a. primary market b. secondary market c. options market d. private financial market e. public financial market 3. Which of the following is an example of rent on financial capital? a. interest on debt b. dividends on stock c. collateral on equity d. a and b e. a, b, and c 4. Which of the following describes the observed or stated interest rate? a. real rate b. nominal rate c. risk-free rate d. prime rate e. inflation rate 5. Which of the following describes the interest rate in addition to the inflation rate expected on a risk-free loan? a. real rate b. nominal rate c. risk-free rate d. prime rate e. inflation rate 6. Which of the following describes the interest rate on debt that is virtually free of default risk? a. real rate b. nominal rate c. risk-free rate d. prime rate e. inflation rate 7. Which of the following describes the interest rate charged by banks to their highest quality customers? a. real rate b. nominal rate c. risk-free rate d. prime rate e. inflation rate 8. Which of the following is not a component in determining the cost of debt? a. inflation premium b. default risk premium c. liquidity premium d. maturity risk premium e. interest rate premium 9. The additional interest rate premium required to compensate the lender for the probability that a borrower will not be able to repay interest and principal on a loan is known as? a. inflation premium b. default risk premium c. liquidity premium d. maturity premium e. investment risk premium 10. The additional premium added to the real interest rate by lenders to compensate them for a debt instrument which cannot be converted to cash quickly at its existing value is called? a. inflation premium b. default risk premium c. liquidity premium d. maturity premium e. investment risk premium 11. The added interest rate charged due to the inherent increased risk in long-term debt is called? a. inflation premium b. default risk premium c. liquidity premium d. maturity premium e. investment risk premium 12. Suppose the real risk free rate of interest is 4%, maturity risk premium is 2%, inflation premium is 6%, the default risk on similar debt is 3%, and the liquidity premium is 2%. What is the nominal interest rate on this ventures debt capital? a. 13% b. 14% c. 15% d. 16% e. 17% 13. A venture has raised $4,000 of debt and $6,000 of equity to finance its firm. Its cost of borrowing is 6%, its tax rate is 40%, and its cost of equity capital is 8%. What is the ventures weighted average cost of capital? a. 8.0% b. 7.2% c. 7.0% d. 6.2% e. 6.0% 14. Your venture has net income of $600, taxable income of $1,000, operating profit of $1,200, total financial capital including both debt and equity of $9,000, a tax rate of 40%, and a WACC of 10%. What is your ventures EVA? a. $400,000 b. $200,000 c. $ 0 d. ($180,000) e. ($300,000) 15. The risk-free interest rate is the sum of:1. a real rate of interest and an inflation premium2. a real rate of interest and a default risk premium3. an inflation premium and a default risk premium4. a default risk premium and a liquidity premium5. a liquidity premium and a maturity premium 16. Venture investors generally use which one of the following target rates to discount the projected cash flows of ventures in the startup stage of their life cycles:1. 20%2. 25%3. 40%4. 50% 17. Which one of the following components is not used when estimating the cost of risky debt capital?1. real interest rate2. inflation premium3. default risk premium4. market risk premium5. liquidity premium 18. Which of the following components is not typically included in the rate on short-term U.S. treasuries? a. liquidity premium b. default risk premium c. market risk premium d. b and c e. a, b, and c 19. The word risk developed from the early Italian word risicare and means:1. dont care2. take a chance3. to dare4. to gamble 20. The difference between average annual returns on common stocks and returns on long-term government bonds is called a:1. default risk premium2. maturity premium3. risk-free premium4. liquidity premium5. market risk premiumMore Questions are IncludedFIN 317 WK 11 Final Exam Part 1 - All Possible QuestionsClick Link Below To Download:http://strtutorials.com/FIN-317-WK-11-Final-Exam-Part-1-All-Possible-Questions-FIN3176.htmFIN 317 WK 11 Final Exam Part 1 - All Possible QuestionsTrue-False Questions 1. The accounting emphasis on accrued revenue and expenses and depreciation is the same emphasis as that of finance managers. 2. Traditional accounting does not focus on the implicit cost of equity that is the required capital gains to complement dividends. However, evaluation methods exist to determine this value by financial managers. 3. Formal historical accounting procedures include explicit records of debt (interest and principal) and dividend capital costs. 4. Public financial markets are markets for the creation, sale and trade of illiquid securities having less standardized negotiated features. 5. A ventures riskiness in terms of poor performance or failure is usually very high during the maturity stage of its life cycle. 6. A ventures riskiness in terms of poor performance or failure is usually high to moderate during the rapid-growth stage of its life cycle. 7. First-round financing during a ventures survival stage comes primarily from venture capitalists and investment banks. 8. Startup financing usually comes from entrepreneurs, business angels, and investment bankers. 9. Commercial banks provide liquidity-stage financing for ventures in the rapid-growth stage of their life cycles. 10. A ventures riskiness in terms of the likelihood of poor performance or failure decreases as it moves from its development stage through to its rapid-growth stage. 11. A nominal interest rate is an observed or stated interest rate. 12. The real interest rate (RR) is the interest one would face in the absence of inflation, risk, illiquidity, and any other factors determining the appropriate interest rate. 13. The risk-free interest rate is the interest rate on debt that is virtually free of inflation risk. 14. Inflation premium is the rising prices not offset by increasing quality of goods being purchased. 15. Default-risk is the risk that a borrower will not pay the interest and/or the principal on a loan. 16. The prime rate is the interest rate charged by banks to their highest default risk business customers. 17. Bond ratings reflect the inflation risk of a firms bonds. 18. The relationship between real interest rates and time to maturity when default risk is constant is called the term structure of interest rates. 19. The graph of the term structure of interest rates, which plots interest rates to time to maturity is called the yield curve. 20. Liquidity premiums reflect the risk associated with firms that possess few liquid assets. 21. Subordinated debt is secured by a ventures assets, while senior debt has an inferior claim to a ventures assets. 22. Early-stage ventures tend to have large amounts of senior debt relative to more mature ventures. 23. Investment risk is the chance or probability of financial loss on ones venture investment, and can be assumed by debt, equity, and founding investors. 24. A venture with a higher expected return relative to other ventures will necessarily have a higher standard deviation or returns. 25. Historically, large-company stocks have averaged higher long-term returns than small-company stocks 26. The coefficient of variation measures the standard deviation of a ventures return relative to its expected return. 27. Closely held corporations are those companies whose stock is traded over-the-counter. 28. Typically, the stocks of closely held corporations arent publicly traded. 29. Organized exchanges have physical locations where trading takes place, while the over-the-counter market is comprised of a network of brokers and dealers that interact electronically. 30. Market cap is determined by multiplying a firms current stock price by the number of shares outstanding.. 31. The excess average return of long-term government bonds over common stock is called the market risk premium. 32. The weighted average cost of capital is simply the blended, or weighted cost of raising equity and debt capital.Multiple-Choice Questions 1. Which of the following markets involve liquid securities with standardized contract features such as stocks and bonds? a. private financial market b. derivatives market c. commodities market d. real estate market e. public financial market 2. Which of the following markets involve direct two-party negotiations over illiquid, non-standardized contracts such as bank loans and direct placement of debt? a. primary market b. secondary market c. options market d. private financial market e. public financial market 3. Which of the following is an example of rent on financial capital? a. interest on debt b. dividends on stock c. collateral on equity d. a and b e. a, b, and c 4. Which of the following describes the observed or stated interest rate? a. real rate b. nominal rate c. risk-free rate d. prime rate e. inflation rate 5. Which of the following describes the interest rate in addition to the inflation rate expected on a risk-free loan? a. real rate b. nominal rate c. risk-free rate d. prime rate e. inflation rate 6. Which of the following describes the interest rate on debt that is virtually free of default risk? a. real rate b. nominal rate c. risk-free rate d. prime rate e. inflation rate 7. Which of the following describes the interest rate charged by banks to their highest quality customers? a. real rate b. nominal rate c. risk-free rate d. prime rate e. inflation rate 8. Which of the following is not a component in determining the cost of debt? a. inflation premium b. default risk premium c. liquidity premium d. maturity risk premium e. interest rate premium 9. The additional interest rate premium required to compensate the lender for the probability that a borrower will not be able to repay interest and principal on a loan is known as? a. inflation premium b. default risk premium c. liquidity premium d. maturity premium e. investment risk premium 10. The additional premium added to the real interest rate by lenders to compensate them for a debt instrument which cannot be converted to cash quickly at its existing value is called? a. inflation premium b. default risk premium c. liquidity premium d. maturity premium e. investment risk premium 11. The added interest rate charged due to the inherent increased risk in long-term debt is called? a. inflation premium b. default risk premium c. liquidity premium d. maturity premium e. investment risk premium 12. Suppose the real risk free rate of interest is 4%, maturity risk premium is 2%, inflation premium is 6%, the default risk on similar debt is 3%, and the liquidity premium is 2%. What is the nominal interest rate on this ventures debt capital? a. 13% b. 14% c. 15% d. 16% e. 17%More Questions are IncludedFIN 317 WK 11 Final Exam Part 2 - All Possible QuestionsClick Link Below To Download:http://strtutorials.com/FIN-317-WK-11-Final-Exam-Part-2-All-Possible-Questions-FIN3177.htmFIN 317 WK 11 Final Exam Part 2 - All Possible QuestionsTrueFalse Questions 1. Despite the high risk and costs of using a facilitator or up-front fee solicitor to obtain financing, many start-ups never-the-less seek them as a source of funds due to the length of time it takes to raise new funds. 2. Collateral plays an important role in determining the willingness to lend and the amount and terms of the loan, making it the most important factor in the lending process. 3. Commercial loan officers have the expertise to project new ventures business successes, and thus are as willing to make funds available to entrepreneurs on the same basis as other businesses. 4. Because investors and commercial lenders both seek returns on the funds given to start-up firms, entrepreneurs can obtain financing as easily from either source. 5. Because of loan restrictions, obtaining funding from commercial lenders is prohibitive for entrepreneurs. 6. Unlike traditional commercial banks, venture banks typically provide debt to start-ups that have already received equity financing from professional venture capital firms. 7. Among start-ups, it is widely understood that bank debt (outside of Small Business Administration loans), is not a very realistic source of financing for ventures with less than two years operating results. 8. Compensation received by commercial loan officers makes them more likely to finance early-stage ventures. 9. Warrants allow lenders to buy equity at a specified price. 10. Warrants are a debt instrument frequently used by commercial banks when financing entrepreneurial ventures. 11. Credit cards issued to start-ups have proven to be an alternative source of start-up financing. 12. The returns to venture bank lenders are generated solely from interest payments made by borrowers plus the return of the loan principal. 13. Commercial banks receive a portion of their returns from warrants in addition to the receipt of interest and the repayment of the principal that was lent. 14. By an act of Congress, the Small Business Administration (SBA) was created for the purpose of fostering the initiation and growth of small businesses. 15. The Small Business Administration was created by an Act of Congress in 2003. 16. Microloans in the SBA credit program are intended for very small businesses with a maximum amount of $35,000 to be used for general purposes. 17. The SBAs role in its microloan credit program is to approve the loans and guarantee up to 85% of the loan value. 18. Microloans in the SBA credit program are made by not-for-profit or government-affiliated Community Development Financial Institutions (CDFIs). 19. The SBAs venture capital credit program works through Community Development Financial Institutions (CDFIs). 20. The 7(a) loan traditionally has been the SBAs primary loan program 21. SBA 7(a) loans are made usually for 1 to 3 years in amounts up to $5,000,000, require collateral, and can be used for most business purposes. 22. The SBA approves the standard 7(a) loan and guarantees up to 85% of the loan value. 23. For the 504 loan, the SBA approves and guarantees the development companys portion of the debt but does not guaranteed the debt of the participating commercial bank. 24. Factoring is the sale of payables to a third party at a discount to their face value. 25. In a factoring arrangement, the third party makes its money by purchasing the receivables at a discount from the total amount due on the receivables. 26. With venture leasing, one component of the return to the lessor is the opportunity to take an equity interest in the venture. 27. Receivables lending is the use of receivables as collateral for an equity issue. 28. Factoring is the selling of receivables to a third party at a discount from their face value. 29. Direct public offerings have recently become a serious challenge to traditional venture capital firms.Multiple-Choice Questions 1. When assessing the creditworthiness of new entrepreneurs, lending institutions review the Five Cs. The ability of the entrepreneur to repay borrowed funds is known as: a. capacity b. capital c. collateral d. conditions e. character 2. When assessing the creditworthiness of new entrepreneurs, lending institutions review the Five Cs. The money the entrepreneur has invested in the business, which is an indication how much is at risk if the business should fail is known as: a. capacity b. capital c. collateral d. conditions e. character 3. When assessing the creditworthiness of new entrepreneurs, lending institutions review the Five Cs. The guarantees, or additional forms of security (such as assets), the entrepreneur can provide the lender is known as: a. capacity b. capital c. collateral d. conditions e. character 4. When assessing the creditworthiness of new entrepreneurs, lending institutions review the Five Cs. The focus on the intended purpose of the loan is known as: a. capacity b. capital c. collateral d. conditions e. character 5. When assessing the creditworthiness of new entrepreneurs, lending institutions review the Five Cs. The general impression the entrepreneur makes on the potential lender or investor is known as: a. capacity b. capital c. collateral d. conditions e. character 6. All of the following are common loan restrictions except? a. limits on total debt b. limits on total equity c. restrictions on dividends or other payments to owners and/or investors d. restrictions on additional capital expenditures e. performance standards on financial ratios 7. Unlike traditional commercial banks, venture banks typically provide debt to start-ups that have already received equity financing from professional venture capital firms. In return for providing additional debt financing, these venture banks receive in return all of the following except? a. interest payments b. repayment of principal c. implementation of loan restrictions d. tax breaks on the interest e. right to buy equity at a specific price 8. Bank debt is not a realistic source of financing for start-ups due to all of the following reasons except? a. a large portion of the assets are intangible and provide no collateral b. payables either dont yet exist or its history is inadequate c. the start-ups dependence on a small number of irreplaceable people is not a good match to demand deposits or other bank liabilities d. receivables collection track record is incomplete e. in the event of a default, it is now plausible for the bank to install a management team to help right the operations 9. A provision that allows lenders to acquire equity at a specific price is known as a(n): a. factor b. warrant c. venture lease d. equity carve-out 10. Personal credit cards have proven to be a source of financing for start-up firms for all of the following reasons except?a. credit card debt is not based on the firms ability to repay, but rather the individual card holders ability to repay b. teaser rates afford initial low cost borrowing c. balance transfer at below-prime rates d. credit card debt can create problems if the firm doesnt generate cash flows to cover credit card payments once low introductory rates expire 11. In the context of new ventures, what does SBA stand for? a. Standard Business Arrangement b. Small Business Association c. Small Business Administration 12. By an act of Congress, the Small Business Administration (SBA) was created in which one of the following years? a. 1953 b. 1968 c. 1973 d. 1985 e. 1993 13. Which is not a duty of the Small Business Administration? a. provide capital and credit to entrepreneurial start-ups b. guaranteeing general business loans c. provide equity financing for start-ups d. help create new jobs in small businesses e. help small firms obtain Federal contracts 14. Which of the following is not a Small Business Administration program? a. loan guaranty programs b. certified and preferred lender programs c. low documentation loan programs d. energy and conservation loan programs e. certified financial planner funding programsMore Questions are IncludedFIN 317 WK 5 Midterm Exam - All Possible QuestionClick Link Below To Download:http://strtutorials.com/FIN-317-WK-5-Midterm-Exam-All-Possible-Question-FIN3175.htmFIN 317 WK 5 Midterm Exam - All Possible QuestionTrue-False Questions1. Entrepreneurs provide the financing to individuals who think, reason, and act to convert ideas into commercial opportunities and create opportunities.2. Entrepreneurship is the process of changing ideas into commercial opportunities and creating value. 3. An entrepreneur is an individual who thinks, reasons, and acts to convert ideas into commercial opportunities and to create value. 4. Mark Twain once said, I was always able to see an opportunity before it became one. 5. Small businesses, those with less than 500 employees, represent over 99 percent of all employers, and account for about one-half of the gross domestic product in theUnited States.6. Small and growing enterprises are critical to the U.S. economy; small firms provide 20 to 30 percent of net new jobs.7. Small high-technology firms are responsible for twice as many product innovations per employee and obtain more patents per sales dollar than large high-technology firms. 8. Phillips and Kirchhoff, using Dun & Bradstreet data, found that 24 percent of new firms were still in existence after two years of operation. 9. Nearly half of business failures are due to economic factors such as inadequate sales, insufficient profits, and industry weakness. 10. Although the risks associated with starting a new entrepreneurial venture are large, there is always room for one more success. 11. Studies by Phillips and Kirchhoff, and by Headd, found that about 38%-40% of new firms survived six years of operation. 12. One study of Inc. magazines 500 high-growth firms suggests that about 88 percent of founders feel their firms successes are due to extraordinary ideas, while the remaining 12 percent feel their firms successes are due to exceptional execution of ordinary ideas. 13. Fads are large societal, demographic, or technological trends or changes that are slow in forming but once in place continue for many years. 14. Fads are not predictable, have short lives, and do not involve macro changes. 15. Three major megatrends discussed in Chapter 1 include: societal trends or changes, demographic trends or changes, and technological trends or changes. 16. In 1982, Harry Dent identified several major or megatrends shapingU.S.society and the world. 17. The so-called baby boom generation applies to people born in theUnited Statesduring the 1946-1964 time period. 18. Perhaps the most important invention shuttling us from an industrial society to an information society is the computer chip. 19. Environmental commerce, or e-commerce, involves the use of electronic means to conduct business online.20. The Office of Advocacy of the U.S. Small Business Administration documents that employer firm births have approached 600,000 annually in recent years.21. Reasonable estimates place nonemployer (e.g., single person or small family) business started each year at less than 100,000.22. Bill Gates once said: I was seldom able to see an opportunity, until it ceased to be one.23. A study by Phillips and Kirchhoff using Dun & Bradstreet data found that about three-fourths of new firms were still in existence after two years of operation. 24. Studies by Phillips and Kirchhoff, and by Headd, found that one-half of new firms or new employers were still in existence after four years of operation. 25. Nine principles of entrepreneurial finance are identified and explored in this entrepreneurial finance textbook, 26. The time value of money is an important component of the rent one pays for using someone elses financial capital. 27. A ventures financial objective is to survive. 28. Private financial markets are a place where standardized contracts or securities are traded on organized security exchanges with restrictions on how they can be transferred. 29. Free cash flow is the net income forecast to be available to the ventures owners over time. 30. Free cash flows are adjusted for risk and the time value of money when used to calculate the value of a venture. 31. Free cash exists when cash exceeds that which is needed to operate, pay creditors, and invest in assets. 32. Free cash is all the cash available to cover operating expenses. 33. Owner-manager (agency) conflicts are differences between managers self-interest and that of the owners who hired the manager. 34. The owner-debtholder conflict is the divergence of the owners and lenders self-interest as the firm gets close to going public. 35. The financial objective of increasing value is inconsistent with developing positive character and reputation. 36. Entrepreneurial finance is the application and adaptation of financial tools and techniques to the planning, funding, operations, and valuation of an entrepreneurial venture. 37. Financial distress occurs when cash flow is insufficient to meet current debt obligations. 38. The second stage in a successful ventures life cycle is the startup stage. 39. The rapid growth stage directly follows the startup stage.40. Early-stage ventures include firms in their development, startup, or survival live cycle stages. 41. Business angels are wealthy individuals acting as informal or private investors, who provide venture financing for small businesses. 42. Mezzanine financing is temporary financing needed to keep the venture afloat until the next offering. Multiple-Choice Questions 1. Successful entrepreneurs exhibit which of the following traits?a. recognize and seize commercial opportunitiesb. economic pessimismc. tend to be doggedly optimisticd. both a and be. both a and c 2. While one must be careful to avoid too many generalizations about entrepreneurial traits or characteristics, which one of the following characteristics would not normally be associated with successful entrepreneurs?1. being able to see and seize a commercial opportunity2. planning for the ventures future3. only being able to see an opportunity after it ceases to be one4. being optimistic about the ventures success 3. About one-half of all newly created businesses in theU.S.are dissolved or cease operations within how many years after being started?a. two yearsb. four yearsc. six yearsd. eight years 4. About 60 percent of all newly created businesses in theU.S.are dissolved or cease operations within how many years after being started?1. two years2. four years3. six years4. eight years 5. Fads are:a. not predictableb. have short livesc. do not involve macro changesd. all of the above 6. Harry Dent documented major generation waves in theUnited Statesduring the twentieth century in: a. 1972 b. 1982 c. 1993 d. 2003 7. E-commerce refers to: a. environmental commerce b. electronic commerce c. economic commerce d. exploratory commerce 8. While entrepreneurial opportunities come from an almost unlimited number of sources, this textbook focuses on:1. societal changes2. demographic changes3. technological changes4. all of the above5. none of the above 9. Indicate the number of principles of entrepreneurial finance that are emphasized in this textbook:1. one2. three3. five4. seven5. nine10. Maximizing the value of the venture to its owners is the common financial goal of which of the following? a. the entrepreneur b. the debtholders c. the venture equity investors d. both a and b e. both a and c 11. Which of the following is considered to be an agency conflict? a. owner-manager conflict b. stockholder-manager conflict c. stockholder-debtholder conflict d. manager-debtholder conflict 12. Which one of the following possible conflicts of interest is usually minimized through the use of equity incentives?1. owner-manager conflicts2. owner-employee conflicts3. manager-employee conflicts4. manager-debtholder conflicts 13. Which one of the following possible conflicts of interest increases in divergence at venture gets close to bankruptcy?a. owner-manager conflictb. owner-employee conflictc. manager-employee conflictd. manager-debtholder conflict 14. Which of the following is not a life cycle stage of a successful venture? a. development stageb. startup stage c. survival stage d. cash cow stage e. maturity stage 15. Which of the following does not describe activity during the ventures life cycle startup stage? a. ventures organization b. ventures development c. operating cash flows are generated d. initial revenue model is put in placeMore Questions are Included