The Cost of Meeting SEC and Possibly Additional State Reporting

question 3

True/False

The cost of meeting SEC and possibly additional state reporting requirements regarding disclosure of financial information, the danger of losing control, and the possibility of an inactive market and an attendant low stock price are potential disadvantages of going public.

---

Definitions:

Feasible Solutions

Solutions that meet all the constraints of a particular problem, considered acceptable and implementable.

Constraint Lines

Lines in a graph of a linear programming model representing limitations or restrictions on the resources available.

Contribution Margin

The amount of revenue from sales that exceeds the variable costs associated with producing a product or service.

Production Constraint

Limitations or restrictions in the production process that prevent a company from reaching its full production potential.