Asked by Falantina Rashoo on May 11, 2024
Verified
Sometimes an entrepreneurial venture becomes a candidate for an ___ in which shares of stock in the business are sold to the public and begin trading on a major stock exchange.
A) equity takeover
B) initial public offering
C) employee stock ownership plan
D) leveraged buyout
E) risky investment shift
Initial Public Offering
The first sale of a company’s shares to the public, leading to a stock exchange listing.
Entrepreneurial Venture
A business undertaking initiated by an individual or group who seeks to innovate, create, and manage the enterprise for growth and profit.
Equity Takeover
The acquisition of control of a company through the purchase of a significant amount of its equity shares.
- Understand the procedure and importance of initial public offerings (IPOs) and venture capital in the growth of businesses.
Verified Answer
MC
Morne CarstensMay 11, 2024
Final Answer :
B
Explanation :
An initial public offering (IPO) is when a company offers its shares to the public for the first time, typically to raise funds for expanding business operations. The shares are listed on a major stock exchange and sold to the public, making it possible for anyone to buy and trade them. An IPO is a major milestone for a business, as it usually implies that the company has grown significantly and is ready to take on new investors.
Learning Objectives
- Understand the procedure and importance of initial public offerings (IPOs) and venture capital in the growth of businesses.