Which of the Following Statements Regarding Private Placements Is False

question 2

Multiple Choice

Which of the following statements regarding private placements is false?

• A) A private placement is a bond issue that does not trade on a public market but rather is sold to a small group of investors.
• B) Privately placed debt need not conform to the same standards as public debt; as a consequence, it can be tailored to the particular situation.
• C) Canadian governments never issue bonds to raise funds to meet their short-term cash flows.
• D) Because a private placement does not need to be registered, it is less costly to issue.

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Definitions:

Constant

A fixed value in mathematics and science that does not change under specified conditions.

Normal Good

A good for which demand increases as consumer income rises, and falls when consumer income decreases.

Income Rises

An increase in the amount of money earned by individuals or households, which can impact their purchasing power and consumption habits.

Marginal Rate

The marginal rate refers to the rate at which one quantity changes with a slight increase in another quantity, often used in economics to discuss changes in tax, cost, or benefit.