Which of the following statements is false?
A) When a corporation's shares are owned by a few individuals who are associated with or are the firm's management,we say that the firm is "closely held."
B) A publicly owned corporation is simply a company whose shares are held by the investing public,which may include other corporations and institutions as well as individuals.
C) Going public establishes a true market value for the firm and ensures that a liquid market will always exist for the firm's shares.
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.

Question

Quizplus · Accepted Answer

Going public does not necessarily establish a true market value for the firm as the market value can still fluctuate based on supply and demand, market conditions, and other external factors. Additionally, while going public may initially create a liquid market for the firm's shares, this can change over time if the company does not perform well or if investors lose interest.

Which of the Following Statements Is False