Which of the Following Is a Drawback of Private Placements

question 26

Multiple Choice

Which of the following is a drawback of private placements?

• A)They are more complex and expensive than public offerings.
• B)Complex registration documents need to be prepared for their financing.
• C)They are required to register with the Securities and Exchange Commission (SEC).
• D)Unregistered securities cannot be sold to anyone except accredited investors.

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Definitions:

Tax Revenues

The income that is gained by governments through taxation, which is then used to fund public services and infrastructure.

Deadweight Loss

The loss of economic efficiency that occurs when the equilibrium outcome is not achievable or not achieved in a market.

Tax Revenue

The financial earnings acquired by governments via taxation.

Deadweight Loss

The shortfall in economic efficiency arising when a market for a good or service does not meet or cannot meet the equilibrium point.