You would like to start a small photography business. You own a nice camera, but you need to purchase some additional equipment in order to get your business started. You approach your parents and offer them 10% equity in your business for a $2300 investment. Given these numbers, what do you feel your company valuation is?
A) $4370
B) $43,000
C) $23,000
D) $17,500

Question

Quizplus · Accepted Answer

To determine the company valuation, we need to use the following formula: investment amount / equity percentage = company valuation. 
Plugging in the given numbers, we get: 2300 / 0.10 = 23,000. Therefore, the company valuation is $23,000. Option C is the correct answer.

You Would Like to Start a Small Photography Business