Question 9

As reported in some major financial newspapers/magazines, the Private Equity (PE) investments into India for the quarter ending March 2009 have dropped by a whopping 87%. What is Private Equity (PE) and why is it so important for our economy ?
(A) The PE is the purchase of a majority or total ownership in an operating company.
(B) The purchase is done normally through institutional investors, like banks or insurance-companies. They are avoiding such investments these days.
(C) Private Equity stake gives a chance to the stake holders to have a better control over its management and crucial functions.

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