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.

---

Definitions:

Progenitor Cells

Cells that have the capacity to differentiate into more specialized cell types, playing a key role in growth, development, and tissue repair.

Neuroblasts

Immature nerve cells that have the potential to develop into mature neurons.

Nerve Growth Factor

Nerve growth factor is a protein essential for the growth, maintenance, and survival of certain neurons in the peripheral and central nervous system.

EGF

Epidermal Growth Factor (EGF) is a protein that stimulates cell growth, proliferation, and differentiation by binding to its receptor, EGFR.