Which of the Following Statements Is False

question 76

Multiple Choice

Which of the following statements is false?

• A) When a corporation's shares are owned by a few individuals who are associated with or are the firm's management, we say that the stock is "closely held."
• B) A publicly owned corporation is simply a company whose shares are held by the investing public, which may include other corporations and institutions as well as individuals.
• C) Going public establishes a true market value for the firm and ensures that a liquid market will always exist for the firm's shares.
• D) When stock in a closely held corporation is offered to the public for the first time the transaction is called "going public" and the market for such stock is called the new issue market.
• E) It is possible for a firm to go public, and yet not raise any additional new capital.

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Definitions:

Notary Public

An official authorized to witness the signing of documents and certify their authenticity for legal purposes.

Paralegal

A legal assistant who performs tasks such as research and documentation under the supervision of an attorney.

Title Examination

The process of reviewing public records to determine the legal ownership of property and to identify any claims, liens, or encumbrances on it.

Title Insurance Company

A company that provides insurance against financial loss from defects in title to real property and from the invalidity or unenforceability of mortgage loans.