ELEC 4445 Quiz 5

Question 1. It has been said that an IPO can "achieve liquidity for its owners and investors". Explain this in your own words. [< 5 words]

(3 Points)

Answer: stocks can be sold

Question   2. What is the main distinction between a director and an employee?

Answer: Personal liability

Question3. True or false: VCs are wealthy individual willing to take risk by investing in startups

Answer: False (Angle investors wealthy individual willing to take risk by investing in startups)

Question 4. Which of the following statement best describe "vesting period" when discussing reward system

Answer: the period of time during which options can be purchased

Question5. When talking about angel investors, the term "bicycle distance" refers to their preference to:

Answer: Invest in companies close to where they live

Question 6. Various aspects of the mobile phone are protected by intellectual property rights.

1. Its visual appearance

2. Its branding

3. Its software and related user's guides

4. Its operations (how it works)

Reorder the following IP rights to match the aspect mentioned above.

Answer

1. Registered Design

2. Trade Marks

3. Copyrights

4. Patents

Question 7. What is Vernor Vinge's position on the forecasted technological singularity?

Answer: that it cannot be stopped

Question 8. We discussed in class, that stocks of a privately owned company (e.g. PTY LTD) cannot be traded freely and are clearly marked with a "TRANSFER RESTRICTED" stamp. Explain in your own words the general idea behind this. [< 50 words]

Answer: to prevent early contributors from selling shares freely and departing the company

Question 9. One of the following points does not belong to the discussion we had when valuing contributions to a startup

(2 Points)

Answer: Capital investment into the business