Which of the Following Is True About Private Placement

question 20

Multiple Choice

Which of the following is true about private placement?

• A) The underwriting function is avoided.
• B) The extremes of high credit quality firms and low or unknown credit quality firms use private placements.
• C) The terms may be negotiated between the issuer and the investors.
• D) The sale of securities must be restricted to a small group of accredited investors.
• E) All of the above is true.

---

Definitions:

Social Loafing

The tendency for individuals to exert less effort to achieve a goal when they work in a group than when they work alone.

Shared Norms

Established behaviors or beliefs that are accepted and adhered to by a group or society.

Group Socialisation

Dynamic relationship between the group and its members that describes the passage of members through a group in terms of commitment and of changing roles.

Role Transition

The process of changing from one role to another, which can involve acquiring new identities, responsibilities, and behaviors.