Which of the Following Statements About Listing on a Stock

question 2

Multiple Choice

Which of the following statements about listing on a stock exchange is most CORRECT?

• A) Listing is a decision of more significance to a firm than going public.
• B) Any firm can be listed on the NYSE as long as it pays the listing fee.
• C) Listing provides a company with some "free" advertising, and it may enhance the firm's prestige and help it do more business.
• D) Listing reduces the reporting requirements for firms, because listed firms file reports with the exchange rather than with the SEC.

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Definitions:

Capital Rationing

The process by which management plans, evaluates, and controls long-term capital investments involving fixed assets.

Investment Funds

Pooled funds from investors that are managed by professionals and invested in a diversified portfolio of assets to earn returns.

Capital Investment

Expenditure on assets that are expected to produce benefits over a long period, such as buildings, machinery, and equipment.

Internal Rate

Often referred to in the context of Internal Rate of Return (IRR), it represents the discount rate that makes the net present value (NPV) of all cash flows from a particular project equal to zero.