Chapter 7: Financing of Entrepreneurial Venture

Very Short Question Answer 1. Who is angel investor? An angel investor refers to a formal entrepreneur or professional who provides starting or growth capital in promising ventures, and helps also with advice and contacts. Angel investors usually operate alone or in very small groups. 2. Define the term equity financing.  Equity financing refers to […]

Chapter 6: Legal Issues of Entrepreneurial Venture

Very Short Question Answer 1. Define the term intellectual property right. The right that protects intellectual properties like inventions, literary and artistic works, designs, and symbols, names and images is known mas intellectual property right. Intellectual property is protected in law through patents, copyright and trademark which enables people to earn recognition or financial benefit […]

Chapter 5: Entrepreneurial Venture Creation

Very Short Question Answer 1. What is marketing plan? A marketing plan is a business document written for the purpose of describing the current market position of a business and its marketing strategy for the period covered by the marketing plan. 2. What is industry analysis? Industry analysis is a tool that facilitates a company […]

Chapter 4: Entrepreneurship Competency Development (ECD)

  Very Short Question Answer 1. Define entrepreneurial competency. Entrepreneurial competency may be defined as the key characteristics that should be possessed by an entrepreneur to perform entrepreneurial functions effectively. In other words, the sum of experience, knowledge, skills and attitude essential to being an entrepreneur is termed as entrepreneurial competency. 2. What do you […]

Chapter 12: DERIVATIVE SECURITIES

Very Short Question Answer 1. How a call option is different from put option? A call option gives its holders the right, but not the obligation, to buy the underlying security at the exercise price, while a put option gives its holders the right, but not the obligation, to sell the underlying security at the […]

Chapter 11: MANAGING PORTFOLIOS

Very Short Question Answer 1. Differentiate between asset allocation and diversification? Asset allocation emphasizes on investing into various assets classes while diversification emphasizes on selecting the securities to be included into a given asset class. Hence, investors can use asset allocation as a way to diversify their investments among asset classes. 2. What is the […]

Chapter 10: Mutual Fund

Very Short Question Answer 1. Why the price of the shares of an open-end fund cannot fall below its net asset value? The price of shares of an open-end fund cannot fall below its net assets value because an open-end fund always stands ready to redeem shares at net asset value. 2. Briefly describe the […]

Chapter 9: Bond Valuation

Very Short Question Answer 1. What do you mean by yield to call? An yield to call is the annualized rate of return that bondholders will realize if the bond is called at the stated date before the maturity. 2. What does bond’s duration indicate? Bond’s duration indicates the weighted average number of years that […]

Chapter 8: Fixed Income Securities

Very Short Question Answer 1. State the major features of fixed income securities and describe any one of them. Fixed income securities have various features such as an issuer, a maturity date, par value, and coupon. Coupon is the stated annual rate of interest that is paid on the par value of fixed income securities. […]

Chapter 7: Common Stock Analysis and Valuation

Very Short Answer Question 1. What is economic analysis? Economic analysis is the process of studying general state of economy to assess economic movements in country and their impact on stock price. In the process of economic analysis, we study the pattern of movement in macroeconomic variables to forecast how they affect specific industry and […]