17. It is INCORRECT to assume an Exit Multiple that's higher than the Purchase Multiple, because multiples always decline over time. a. True b. False 18. Since a recession reduces most companies' cash flows, the returns achieved by PE funds raised (and investments made) in the midst of economic recessions are always lower. a. True b. False 19. Which of the following scenarios will produce the HIGHEST IRR for a PE firm in an LBO scenario? a. The PE firm invests $100 million in a company and eams back $200 million at the end when it sells the company, representing a 2.0x retum. b. The PE firm invests $50 million in a company and earns back $150 million at the end when it sells the company, representing a 3.0x retum. c. The PE firm invests $150 million in a company and earss back $375 million at the end when it sells the company, representing a 2.5x retum - but it also receives a dividend of $100 million from the company in Year 3 , boosting the retum to 3.2x. d. You cannot determine the answer without knowing the time periods for each of these scenarios (i.e. how many years in between purchase and exit). 20. Which company has benefited from Series round of financings? a. Logo b. Dogtas Kelebek c. Probi d. None of the above 21. Which of the following is the largest LBO in Turkey? a. Turk Telekom b. Turkcell c. 3rad Bosphors bridge d. Petrol Qfisi 22. Too much debt is disadvantageous due to a. High tax benefits b. Indirect banknuptcy costs c. low return on equity d. None of the above