Quiz Ch 15 – T/F IPO Pricing for Capital Generation
Fundamentals of Corporate Finance
Brealey, Myers, and Marcus
10th Edition
True or false: IPOs are typically priced on the higher side to raise substantial capital.
True or false: IPOs are typically priced on the higher side to raise substantial capital.
True or false: In numerous countries, including those with large businesses, private ownership is a common practice.
True or false: Smaller firms, which typically bear higher issuing costs for public securities, often opt for private placements.
True or false: Public companies, when making a general cash offer of debt or equity, essentially undergo a procedure akin to their initial public offering.
True or false: Private placements usually require a cash offer.
True or false: Reselling privately placed securities can be challenging.
True or false: A rights issue is when a public company extends an offer of shares exclusively to its current shareholders, aiming to raise extra capital.
True or false: A rights issue, like a general cash offering, presents a share purchase proposal to both existing and potential shareholders.
True or false: Rights offerings involve shares priced at a substantial discount to market value, motivating shareholders to exercise or sell their rights.
True or false: Sarbanes-Oxley Act reduced reporting for small public companies and decreased return to private ownership.