The Abnormal Returns for Initial Public Offerings Over Longer Time

question 56

Multiple Choice

The abnormal returns for initial public offerings over longer time periods seem to call market efficiency into question because:

• A) the average returns at announcement are large and positive while the long-term results are much lower than the returns for seasoned equity offerings.
• B) the average returns at announcement are small and negative while the long-term results are much lower than the returns for seasoned equity offerings.
• C) the average returns at announcement are zero while the long-term results are much higher than the returns for seasoned equity offerings.
• D) the average returns at announcement are large and positive while the long-term results are much higher than the returns for seasoned equity offerings.
• E) the average returns at announcement are insignificant while the long-term results are much lower than the returns for seasoned equity offerings.

Identify groupthink, its symptoms, and prevention methods.

Understand evidence-based management and its importance in decision-making.

Recognize the role of a devil's advocate in challenging proposals and strategies.

Explain the phenomena of risky shift and conservative shift in group decision-making.

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Definitions:

Mediator

A neutral third party who facilitates negotiations or conflict resolution between disputing parties, aiming for a mutually acceptable agreement.

Implementing Agreement

The process of putting a mutually agreed plan or contract into action.

Positive Effects

Beneficial outcomes or impacts resulting from a particular action or set of conditions.

Accommodating

The approach of being willing to adjust actions or decisions to allow for others’ needs, preferences, or interests.