When Stock in a Closely Held Corporation Is Offered to the Public

question 1

True/False

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 initial public offering,or IPO,market.

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Definitions:

Zero-coupon Bond

A bond that does not pay periodic interest, but is sold at a deep discount from its face value and redeemed at full value at maturity.

Rate of Return

The returns or setbacks realized from an investment over a certain time period, expressed as a percentage of the initial capital invested.

Yield to Maturity

The total return anticipated on a bond if the bond is held until it matures, factoring in all interest payments made over time.

Zero-coupon Bond

A bond that does not pay interest during its life and is sold at a discount from the face value, which is paid to the holder at maturity.