Which of the following statements is NOT CORRECTσ
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.

Question

Quizplus · Accepted Answer

Going public does not necessarily establish a firm's true intrinsic value, as the value is still subject to market forces and fluctuations. Additionally, it does not insure that a highly liquid market will always exist for the firm's shares, as market conditions can change.

Which of the Following Statements Is NOT CORRECTσ