Which Statement Is Describes a General Disadvantage of Going Public

question 26

Multiple Choice

Which statement is describes a general disadvantage of going public?

• A) It facilitates stockholder diversification.
• B) It increases the liquidity of the firm's stock.
• C) It establishes a market value for the firm.
• D) It makes it easier for owner-managers to engage in profitable self-dealings.

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Definitions:

P > .05

A statistical expression indicating that the probability of the observed data, or something more extreme, if the null hypothesis is true, is greater than 5%.

Null Hypothesis

The default assumption in statistical hypothesis testing that there is no significant effect or difference, intended to be challenged by the alternative hypothesis.

Degrees of Freedom

The number of independent values or quantities that can be assigned to a statistical distribution, which affects the calculation of statistical estimates.

T-test for Dependent Means

A statistical test used to compare the means of two related groups.