Management's First Step in Any Issue of Securities to the Public

question 43

Multiple Choice

Management's first step in any issue of securities to the public is:

• A) to file a registration form with the SEC.
• B) to distribute copies of the preliminary prospectus.
• C) to distribute copies of the final prospectus.
• D) to obtain approval from the board of directors.
• E) to prepare the tombstone advertisement.

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Definitions:

Fewer Resources

A situation or condition where there is a reduced availability of inputs or factors of production such as land, labor, and capital.

Comparative Advantage

The ability of an individual, firm, or country to produce a good or service at a lower opportunity cost than competitors.

Opportunity Cost

The expense incurred by not choosing the second-best option when making a decision or selection.

Comparative Advantage

The capacity of an entity to generate a product or service with a smaller opportunity cost than others.