Question

Which of the following statements concerning common stock and the investment banking process is NOT CORRECT? If a firm sells 1,000,000 new shares of Class B stock, the transaction occurs in the primary market. Private placements can generally bring in funds faster than is the case with public offerings. Stockholders have the right to elect the firm's directors, who in turn select the officers who manage the business. If stockholders are dissatisfied with management's performance, an outside group may ask the stockholders to vote for it in an effort to take control of the business. This action is called a tender offer. When stock in a closely held corporation is offered to the public for the first time, the transaction is called "going public," and the market for such stock is called the new issue market. The cost of meeting SEC and possibly additional state reporting requirements regarding disclosure of financial information, the danger of losing control, and the possibility of an inactive market and an attendant low stock price are potential disadvantages of going public.

Answer 1

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Answer:

Stockholders have the right to elect the firm's directors, who in turn select the officers who manage the business. If stockholders are dissatisfied with management's performance, an outside group may ask the stockholders to vote for it in an effort to take control of the business. This action is called a Tender offer

Tender offer is something related to buyback of shares of the stockholders without the involvement of directors