A Corporation Can Use an Initial Public Offering of Stock

question 116

True/False

A corporation can use an initial public offering of stock to borrow money that it must pay back.

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Definitions:

Investment Firms

Companies that invest pooled funds from clients, taking positions in various financial instruments for profit.

Corporate and Municipal Securities

Financial instruments issued by corporations and local government entities, respectively, to raise capital by borrowing from investors.

Auctions

Competitive bidding processes where goods or services are sold to the highest bidder, commonly used for art, antiques, real estate, and online platforms.

Common Stock

A type of equity security that represents ownership in a corporation, giving shareholders voting rights and a share in the company's profits through dividends.