Question

2.The initial public offering is what kind of public issue? Select one:

a. Private issue

b. Private placement

c. Cash offer

d. Rights offer

3. What is the best way for brand new and emerging firms to raise capital and grow their business?
Select one:
a. Applying for a loan from the bank which handles the firm’s accounts.
b. Applying for a loan from local economic development agencies such as Invest Ottawa.
c. Partnering with an underwriter to draft an initial public offering.
d. Seeking funds from a venture capitalist

Answer 1

2. Initial public offering is a kind of cash offer in which the the offer is made to the public for exchange of equity in terms of the cash.

it is a public offering and it has nothing to do about private issue and private placement.

It is neither rights issue because rights issues are secondary is used which are made by company which are already listed.

Correct answer would be option ( C) cash offer.

3. New company should always be trying to raise the capital through venture capitalist because they will be providing not just capital but specialised services also.

New company generally does not arrange capital through loans.

Correct answer would be option ( d). Seeking funds from venture capitalists.