Which of the Following Statements Is NOT CORRECT

question 26

Multiple Choice

Which of the following statements is NOT CORRECT?

• A) When a corporation's shares are owned by a few individuals and are not traded on public markets, we say that the firm is "closely, or privately, held."
• B) "Going public" establishes a firm's true intrinsic value, and it also insures that a highly liquid market will always exist for the firm's shares.
• C) 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 new issue market.
• D) Publicly owned companies have shares owned by investors who are not associated with management, and public companies must register with and report to a regulatory agency such as the SEC.
• E) It is possible for a firm to go public and yet not raise any additional new capital at the time.

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Definitions:

Sight Draft

A financial document demanding immediate payment upon presentation to the drawee, commonly used in international trade to control the transfer of goods.

Buyer's Bank

The financial institution that processes payments on behalf of a buyer, especially in international trade transactions.

Agreed-on Amount

A specific sum of money that has been mutually consented to by the parties involved in a transaction or contract.

International Purchasing Offices

Entities established by companies in foreign countries to facilitate the sourcing and procurement of goods and services.