Question

11. Which of the following is false about Private Equity?

A) Private Equity is an alternative investment class consisting of capital that is not traded on a public exchange

B) Private Equity firms played a key role in funding the Silicon Valley Boom.

C) During the Great Recession default rate for Private Equity firms was higher than for other Financial Intermediaries.

D) Private Equity firms love to collect on medical bills.

E) All the above are true

Answer 1

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The answer is: B) Private Equity firms played a key role in funding the Silicon Valley Boom.

Correct reason: Venture Capital firms played a key role in funding the Silicon Valley Boom.

Remaining reasons:

A. PE is an Alternative Investment, The name Private suggests that it is not traded on Exchange.

C. PE did more default due to more leverage during a great recession.

D. PE firms love to benefit and take advantage of people in pain. That is charging more on medical bills.