Exam 5: Corporations Issuing Equity in the Share Market

Ordinary shares in limited liability companies are the major source of external equity funding for Australian companies.Which of the following statements regarding the issuance of ordinary shares by a newly listed limited liability company is incorrect?

Some of the main principles that form the basis of a stock exchange's listing rules are:

A right that can only be exercised by the shareholder and not sold is called a:

The subscription price in a rights offering is generally:

Potential investors learn of the information concerning the company and its new issue by being sent a _____ by the broker.

If a company raises equity funds by issuing shares to a selected number of institutional investors,this is known as:

Increasing the financial leverage of a company will _______ shareholders' expected returns and ______ their risk.

Which of the following requirements does NOT apply to a company seeking a public listing on the ASX?

Discuss the attractions of a private placement for a company.

Financial risk refers to the:

A financial institution involved in underwriting the sale of new securities by buying them from the issuing firms and then reselling them to the public in the primary capital market is an:

Which of the following requirements does NOT apply to a company seeking a public listing on the Australian Securities Exchange (ASX)?

Dividend reinvestment schemes are a significant source of equity for many Australian companies.Which of the following advantages of dividend reinvestment schemes may,at times,also be regarded as a disadvantage?

Compared with raising debt through a bank,the raising of equity through an IPO is generally:

A company may seek to raise further funds by issuing additional ordinary shares.The terms and conditions of the new share issue are determined by the board of directors in consultation with its financial advisers and others,and having regard to the preferences of existing shareholders and the needs of the company.Which of the following is LEAST likely to be a determinant of the price that is eventually struck?

What is capital budgeting and explain its importance for a company.

Which of the following is NOT a feature of preference shares?

Which of the following is NOT a role of an underwriter in a public offering of shares?

Generally,an initial public offering is:

Compared with a pro-rata issue of shares,placements usually: