You are a pragmatic parent of two children who are college graduates and you have accumulated some savings of $100k. One child was an 'A' student, lives independently & opened a local restaurant after graduation that has become well known and is always busy, but hasn't turned a profit yet in it's first 3 years. The other child, was a 'C' student, has no income, lives back at home and is trying to launch a software business. The restaurant owner wants to borrow $100k from you to do some landscaping and to buy some new furniture for the restaurant. The other child has developed an App that has just become available on the Apple i-Store. He needs $100k to hire a couple of his friends to complete the beta testing over the next 90 days and write some additional code for the advanced version of the App. Knowing that restaurants can be valued at 1.2X earnings & that software business are getting acquired at 8X revenue, which of the two children--or situations-- would be the BEST recipient of the $100k?

A: Loan the money to the restaurant owner to be paid back only when the business becomes profitable. B: Give the money to the developer of the App in exchange for a minority share interest for yourself and a royalty on future sales to be paid to the restaurant owner. C: Give money to the restaurant and write it off as a tax loss D: Neither child. Never loan or invest money with family members. E: Loan the money to the developer of the software App with strict repayment terms F: Give $50k to the restaurant owner and loan $50k to the App business. Correct Answer: B: Give the money to the developer of the App in exchange for a minority share interest for yourself and a royalty on future sales to be paid to the restaurant owner.