Which of the Following Statements Is FALSE

question 66

Multiple Choice

Which of the following statements is FALSE?

• A) Many IPOs, especially the larger offerings, are managed by a group of underwriters.
• B) At an IPO, a firm offers a large block of shares for sale to the public for the first time.
• C) After deciding to go public, managers of the company work with an underwriter, an investment banking firm that manages the offering and designs its structure.
• D) The shares that are sold in the IPO may either be new shares that raise new capital, known as a secondary offering, or existing shares that are sold by current shareholders (as part of their exit strategy), known as a primary offering.

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Definitions:

Reciprocity Norm

A social rule that suggests people should return help and cooperation they have received from others.

Potential Customer

An individual or entity that could be interested in purchasing a product or service, but has not yet decided to do so.

Reactance Response

A psychological reaction that occurs when people feel their freedom to choose or act is threatened, leading them to resist the influence or change.

Foot-in-the Door Technique

A persuasion strategy where a small request is made first in order to increase the likelihood of compliance with a larger request later.