In a short essay, describe the steps an entrepreneur typically takes in planning and organizing an entrepreneurial venture
What will be an ideal response?
Answer: In planning an entrepreneurial venture, an entrepreneur would first develop an organizational mission. Next, he or she would spend time creating a detailed business plan for the venture. This would include details of how the organization would actually run. After the business plan was complete, the entrepreneur would focus on two types of organization. First, the entrepreneur would determine what kind of legal form the organization would have. This would help the organization deal with tax and liability issues. Finally, the entrepreneur would work on organizing the actual organizational structure of his or her new company.
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The stocks and bonds issued by a corporation are the financial capital resources of the corporation.
Indicate whether the statement is true or false
Unlike the situation with exchange rate risk, there is no uncertainty on the part of management for shareholder preferences regarding interest rate risk
Shareholders prefer that managers hedge interest rate risk rather than having shareholders diversify away such risk through portfolio diversification. Indicate whether the statement is true or false.