How are start-up firms usually financed?

Q: When is a firm's investment pool equal to the MARR?

A: The internal rate of return (IRR) is a capital budgeting metric used to gauge the benefit of…

Q: Why should a firm's investments always exceed its cost of capital?

A: The main aim behind any investment is to generate returns for the company. These projects help the…

Q: Explain Entrepreneurial Profits?

A: The question is based on the concept Entrepreneurial Profits, profit earned by an enterprise.

Q: How do investors reduce investment risk by asset allocation and diversification?

A: Investment risk is a risk of potential financial loss built into the investment. For example:…

Q: it better to finance a company thru debt or thru equity? Why? What are the downside and upside to…

A: A business can raise funds predominantly either by  Issuing Equity, or Borrowings Loans, Issuing…

Q: What are the various suppliers of venture capital?

A: Middle people within the venture investment industry are considered professional venture…

Q: Is cost of capital set by investors or managers?

A: Cos of capital (Coc) is rate of return required to make capital budgeting decisions for example,…

Q: How does the percentage of ownership a company has in an investment effect them? Would the…

A: Investment in Associates and Joint venture and Subsidiary   Equity Accounting method - This method…

Q: Why is working capital a particularly important area of concern for financialmanagers?

A: Managing working capital is an important concern to financial managers because this affects an…

Q: How can we determine the firm's liquidity?

A: Liquidity: It can be defined as the ease or comfort with which a firm can convert its securities and…

Q: When does a firm said to have a complex capital structure?

A: Capital structure of a company means mixture of debt and equity sources of finance of the company…

Q: why do technology and biotech firms use equity financing for a majority of their capital?

A: Equity financing is a source of financing the funds for the firms from equity shareholders. For…

Q: what is investment banker role in company?

A: An investment banker is an intermediary which links borrower of funds (big companies) and lender of…

Q: what is return on investment capital and profitability analysis?

A: Both return on investment and profitability analysis are  profitability ratios

Q: What does the term “value of an unlevered firm” mean?

A: A firm is an organization that sells or produces something or that offers a service.