An entrepreneur has no wealth but has a project that yields high cash flows if she makes
Fantastic news! We've Found the answer you've been seeking!
Question:
An entrepreneur has no wealth but has a project that yields high cash flows if she
makes an effort and low cash flows if she does not make an effort. She also gets a
private benefit in case of no effort. The effort is not verifiable by outside investors.
Discuss qualitatively without any calculations what type of outside investors would
be more suitable for this project. Explain in detail the issue that the entrepreneur
faces.
Related Book For
Financial Reporting Financial Statement Analysis and Valuation a strategic perspective
ISBN: 978-1337614689
9th edition
Authors: James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Posted Date: