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After an IPO, the value of a company’s securities is set by the market through the...

After an IPO, the value of a company’s securities is set by the market through the laws of supply and demand. True or False?

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Answer #1

After IPO when securities are listed on stock exchange price of securities determined by Demand and Supply in the market .

Statement is true .

Explanation : After IPO once securities listed on exchange investor will buy share which has good outlook and higher potential of gowth. With high demand price of secrities will increase .

Stock with poor outlook and lower potential growth will face higher volume of sale and price will fall.

Hence, demand and supply will determine price/value of stock.

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