Chapter 15 Test Bank

Chapter 15 Test Bank - CHAPTER 15 Raising Capital I...

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CHAPTER 15 Raising Capital I. DEFINITIONS Topic: VENTURE CAPITAL 1. The financing provided for start-up, often high-risk, private business enterprises is called: A) Venture capital. B) Junk bonds. C) Flotation costs. D) Initial public offerings. E) Financial futures. Answer: A Topic: REGISTRATION STATEMENT 2. The document(s) filed with the SEC disclosing all material information relating to the firm making an offering of public securities is called the _______________. A) offering prospectus B) registration statement C) red herring filing D) indenture contract E) SEC Form 13-J Answer: B Topic: REGULATION A 3. The SEC filing exemption of most registration materials for public offerings of securities less than $5 million in value is called: Topic: PRELIMINARY PROSPECTUS 4. The preliminary prospectus distributed to investors during the SEC waiting period is often called a(n):
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5. The ______________ is transmitted to the prospective issuing firm by the SEC when they have suggestions for changes to the registration statement and/or its supporting documents. Topic: PROSPECTUS 6. The legal document describing details of the issuing corporation and its security offering to potential investors is called the _________________. A) offering prospectus B) tombstone advertisement C) letter of comment D) Regulation A statement E) rights offering Answer: A Topic: TOMBSTONE 7. Advertisements in, for example, The Wall Street Journal announcing a corporation's public offering of securities, along with a list of the investment banks handling the offering, are called: Topic: GENERAL CASH OFFER 8. An issue of securities offered for sale to the general public on a direct cash basis is called a:
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9. A public offering of securities where existing shareholders of the firm have the first opportunity to buy the new securities, exclusive from the general public, is called a: Topic: INITIAL PUBLIC OFFERING
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