Deck 10: Managing the Financial Side of Social Ventures

Question 1

The amount of cash a company uses during a certain period of time, usually in months is referred to as ______________.

A) Cash flow.
B) Burn rate.
C) Cash disbursement.
D) Equity.

Answer 1

B

Question 2

______ are not donations. Rather, they are investments intended to generate attractive returns on investment while at the same time using market-based solutions to address social issues.

A) Crowdfunding.
B) Social venture capital investments.
C) Bootstrapping.
D) Crowdsourcing.

Answer 2

B

Question 3

In which of the following funding mechanisms are the loans provided to borrowers generally small in nature but can prove beneficial if the social venture does not require much seed money?

A) Microlending.
B) Bootstrapping.
C) Financial analysis.
D) Bank loans.

Answer 3

A

Question 4

_______ refers to the supply of capital to charities, social ventures, and businesses with social missions and an approach to managing capital that yields social dividends as well as economic returns.

A) Social marketing.
B) Social finance.
C) Cause-related marketing.
D) Financial vulnerability.

Question 5

When a social venture receives most of its revenue from a large variety of sources, its financial vulnerability is likely to be _______.

A) Low.
B) High.
C) Stable.
D) Equal.

Question 6

When a social venture receives most of its revenue from relatively few sources, its financial vulnerability is likely to be _______.

A) Low.
B) High.
C) Stable.
D) Equal.

Question 7

Which of the following indexes is used to measure the financial vulnerability of a social venture?

A) Gross profit margin.
B) Gross surplus margin.
C) Financial viability index.
D) Debt ratio.

Question 8

Because John has limited financial resources to launch his social venture, he is trying to find ways to avoid the need for external funding. As a result, he engages in cost-cutting measures by relying on used equipment and technology and whatever he can do to reduce costs. John is probably using ______.

A) Crowdfunding.
B) Fundraising.
C) Bootstrapping.
D) Crowdsourcing.

Question 9

To raise capital for her new social venture, Martha has launched a campaign that uses an Internet-based platform. This campaign allows participants to contribute to her social venture by donating small amounts of money. Martha is probably relying on ____________.

A) Crowdfunding.
B) Fundraising.
C) Capital budgeting.
D) Crowdsourcing.

Question 10

Which of the following types of investment comprises the total time and effort that a founder invests in a new venture?

A) Equity crowdfunding.
B) Social venture capital investments.
C) Sweat equity.
D) Crowdsourcing.