A Secondary Offering IPO Occurs When

question 66

Multiple Choice

A secondary offering IPO occurs when:

• A) new shares are sold to provide the company with additional funds.
• B) the second public issue of equity becomes available.
• C) the company's founders or venture capitalists market a portion of their shares.
• D) not all of the shares in a primary IPO were sold.

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Definitions:

Expected Return

The predicted average of all possible returns for an investment, considering both risk and reward.

Beta

A measure of a stock's volatility in relation to the overall market; a beta above 1 indicates greater volatility than the market, while a beta below 1 indicates less.

Risk-Free Rate

A hypothetic return rate on a risk-free investment, usually shown by the returns on government securities.

Expected Return

The weighted average of all possible returns from an investment, accounting for the likelihood of each outcome.