In which of the following ways can a corporation raise new funds for investment? I. Issuing new shares of stock
II) Having existing stock resold between two owners

Question

Quizplus · Accepted Answer

A corporation can raise new funds for investment by issuing new shares of stock, which is known as equity financing. The funds raised from the sale of new shares can be used for investments such as research and development, acquisitions or expansion. Reselling existing stock between two owners, also known as a secondary offering, does not provide any new funds for the corporation as the shares are merely changing hands between investors.

In Which of the Following Ways Can a Corporation Raise