What are disadvantages for a company to go public by issuing equity in an initial public offering (IPO)?   Question 16 options:   a)  It reduces information asymmetry for competitors   b)  Class action lawsuits can occur following large stock price drops   c)  It can attract analyst following resulting in myopic decisions   d)  All of the above are disadvantages of an IPO   e)  None of the above are disadvantages of an IPO

Question 16 (: Which of the following statements is TRUE about the Modigliani and Miller Theory regarding dividend policy ? Shareholders are indifferent between receiving a capital gain on their shares or dividend income Companies should invest in all available positive NPV projects before paying out a dividend Investors in a perfect market may see the cutting of dividends as a bad sign Some investors liquidity requirements mean that they will respond badly to a cut in dividends.

Why might a company repurchase its own stock? A) It believes that the market undervalues its shares B) To offset dilutive effects of employee stock options granted C) To recognize an economic gain when the treasury shares are later sold for a profit D) To improve earnings per share by reducing the denominator E) All of the above is it just A and B or is it all of the above

To the extent that shares sold during an IPO are discounted from their appropriate price, the proceeds that the issuing firm receives from the IPO are lower than it deserves.   Question 21 options:   True   False

Under what conditions might dividend policy affect the value of the firm?   Question 12 options:   a)  Dividends are irrelevant because firms can simply repurchase shares   b)  None of the options are correct   c)  If a fixed dividend payout preempted the effort to invest in positive NPV projects   d)  Failure to pay a dividend results in bankruptcy   e)  Dividend policy can affect the value of equity, but not affect the value of the firm

Which one of the following statements about dividend policies is FALSE? a. One advantage of dividend reinvestment plans is that they allow shareholders to maintain a position in a company with minimal trading. b. One key disadvantage of a residual dividend policy is that it makes it hard for a company to follow a stable dividend policy. c. The clientele effect suggests that brokerage companies should choose customers whose dividend preferences match those of their client service borkers. d. The "bird-in-the-hand effect" is the argument that investors prefer dividends to capital gains because dividends are more certain than capital gains. e. In today's tax environment, gains through stock repurchases and dividend payments are taxed at the same rate

which one is correct please confirm? QUESTION 21 Finance researcher Myron Gordon argues that ____.   a. the clientele effect has no influence on share value   b. the existence of transaction costs has no impact on the dividend decision   c. dividends reduce uncertainty, and thus the payment of dividends will increase the firm's value   d. risk-averse shareholders may prefer some dividends over the promise of future capital gains if the interest rate is expected to decline

What are some of the risks an investor would face when investing in a stock? In addition to the business risk coming from the type of business environment that your company operates in, what additional risk would be of concern to an investor? The company might be mismanaged and do poorly or go out of business. The company's stock market return might be wildly unpredictable as the operating performance might be unstable. The company's competitors might do a better job and take market share away? The list goes on and on... What risks would you face if you bought 100 shares of Tesla?

In the context of Initial Public Offerings (IPO),  what is the main drawback of the book-building process?     The fact that it may lead to overpricing of the company's shares     The fact that the share allocation process is not transparent and may lead to quid-pro-quo and other forms of collusion between institutional investors and underwriters     The fact that it may fail to attract institutional investors, thus leaving the company with few or no institutional analysts to issue recommendations on the company's shares     The fact that the IPO may fail due to lack of venture capitalists backing

Which of the following statements is true? Group of answer choices a. Dividend payments are attractive to executives who hold many executive stock options that were awarded to them by their firms b.Executives and other insiders benefit most by being able to tender their shares in an open market repurchase since they usually are privy to information that is not available to the general public                                                 c.Empirical research suggests that small, retail investors prefer stock repurchases to dividend payments d. a firm does not pay dividends, some institutional investors are prohibited from investing it the firmʹs equity