As Part of the Registration Statement, Called the Preliminary Prospectus

question 8

Multiple Choice

As part of the registration statement, called the preliminary prospectus, circulates to investors before the stock is offered. This preliminary prospectus is also called a(n) :

• A) IPO filing.
• B) 10-K filing.
• C) blue whale.
• D) red herring.

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Definitions:

Total Surplus

The sum of consumer surplus and producer surplus, representing the total benefit to society from the production and trade of goods and services.

Consumer Surplus

The difference between the total amount consumers are willing to pay for a good or service and the total amount they actually pay; a measure of consumer benefit.

Producer Surplus

The difference between the amount a producer is actually paid for a good compared to the minimum amount they would accept for the good.

Excess Supply

A market condition where the quantity of a commodity available for sale exceeds the quantity demanded at the current price.