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.

Question

Quizplus · Accepted Answer

Going public does not necessarily establish a firm's true intrinsic value, as a company's valuation can be influenced by various factors such as market conditions, investor sentiment, and industry trends. Additionally, while going public does provide a liquid market for a firm's shares, it does not ensure that a market will always exist for the shares.

Which of the Following Statements Is NOT CORRECT