31. Vasily selling his business. As a harvesting owner we : 1477099
31. Vasily is selling his business. As a harvesting owner we would expect him to prefer _____ over _____.
a. cash, stock
b. debt, equity
c. equity, debt
d. stock, cash
32. In a harvest situation, the exiting owners are usually paid in cash or
a. tangible assets.
b. imputed goodwill.
c. favorable publicity.
33. The effects of the harvesting process include
a. a reduction in time and energy.
b. an increased managerial focus.
c. an increase in momentum.
d. poor performance.
34. Uncertainties accompanying an impending sale of a business often
a. lead to lower employee morale.
b. attract the attention of the Securities and Exchange Commission.
c. cause the deal to fall through.
d. increase costs from added legal services.
35. Which group is always concerned about how to exit a business?
c. Employees of the firm
d. Investment bankers
36. When is the right time to begin thinking about an exit strategy?
a. When the owner wants to retire
b. When a willing buyer expresses an interest
c. When declining health forces the owner to leave active management
d. When the money is first invested in the business
37. After harvesting, many entrepreneurs experience conflicts that are _____ in nature.
38. Evangeline has sold her small boutique to a large retail chain but has agreed to stay on and manage the store. Evangeline should expect:
a. freedom from responsibility.
b. a feeling of elation with her new wealth.
c. greater independence.
d. culture conflict.
39. Arthur’s company is doing well but he has grown a bit tired of the daily grind. The idea of selling is appealing to him. What would you recommend Arthur do next?
a. Ask his advisory board for their opinions.
b. Ask a business broker what his business is worth.
c. Go public.
d. Get advice from someone who has sold a business.
40. Post-harvest entrepreneurs may become disillusioned when they realize their sense of identity
a. was associated with the quest for wealth.
b. derived from interactions with employees.
c. was intertwined with their business.
d. does not return after joining in social or charitable work.
41. Before he executes his exit strategy, Arthur should:
a. understand why he wants out.
b. make sure his heirs approve his exit strategy.
c. find a hobby to occupy his time.
d. plan his budget based on the sudden inflow of cash.