When corporations shares are owned by a few individuals

Assignment Help Financial Management

Reference no: EM131014387

Which of the following statements is not correct? (a) When a corporation's shares are owned by a few individuals who own most of the stock or are part of the firm's management, we say that the firm is closely, or privately, held. (b) Going public establishes a firm's true intrinsic value and ensures that a liquid market will always exist for the firm's shares. (c) Publicly owned companies have sold shares to investors who are not associated with management, and they must register with and report to a regulatory agency such as the SEC. (d) 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. (e) It is possible for a firm to go public and yet not raise any additional new capital.

Reference no: EM131014387

Questions Cloud

State of economy probability of state of economy : You are given the following information: State of Economy Probability of State of Economy Rate of Return if state occurs

Manova is the method of analysis : MANOVA is the method of analysis that - Uses several independent variables to predict the category to which a participant belongs, Describes the relationship between a predictor and an outcome variable, Describes the effect of an independent variable..

Forecasts free cash flow in one year : A company forecasts free cash flow in one year to be -$10 million and free cash flow in two years to be $20 million. After the second year, free cash flow will grow at a constant rate of 4 percent per year forever. If the overall cost of capital is 1..

Compute implied volatilities of both options on both dates : Assume an annual rate of interest of 1% and an annual dividend rate of 2%. Both rates are continuously compounded. a) Compute the implied volatilities of both options on both dates. b) Create a P&L explanation for these two options. A P&L explanatio..

When corporations shares are owned by a few individuals : When a corporation's shares are owned by a few individuals who own most of the stock or are part of the firm's management, we say that the firm is closely, or privately, held. Going public establishes a firm's true intrinsic value and ensures that a ..

Assets liabilitites-demand deposits cost : Construction loans pay off in 1 year and earn 6%. Home loans are long term assets and earn 4%. Demand deposits cost 2%. What is the highest rate the bank can pay on time deposits to achieve the required return of 7% to bank shareholders? A.8.33% B. ?..

Write a paper on parental substance abuse : Write a paper on parental substance abuse and its effect on adolescent development

Average firm in the industry has total assets turnover ratio : Adele Corp's sales last year were $315,000, and its year-end total assets were $355,000. The average firm in the industry has a total assets turnover ratio (TATO) of 2.4. The firm's new CFO believes the firms has excess assets that can be sold so as ..

What has happened to treasury rates over the past ten years : Explain what this graph is showing. What has happened to Treasury rates over the past ten years? Are rates higher or lower than they were five years ago and ten years ago? How much have they changed?

User Account

All Pages