Going public offers a company the following advantages, except:

a. The ability to raise capital at a higher valuation

b. Access to broader financial markets to fund capital requirements

c. The ability to use stock instead of cash to acquire strategic technologies

d. The ability to borrow at a lower interest rate

Question

Business

Cristofer Villegas

8 May, 19:14

Going public offers a company the following advantages, except:

a. The ability to raise capital at a higher valuation

b. Access to broader financial markets to fund capital requirements

c. The ability to use stock instead of cash to acquire strategic technologies

d. The ability to borrow at a lower interest rate

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Answers (1)

Know the Answer?

Macey · Answer 1

Answer: d. The ability to borrow at a lower interest rate

Explanation:

Going public, in form of initial public offering (IPO) which is the first sale of stock by a company have varieties of advantages such as growth by generating more capital, publicity by generating more public awareness, also giving them access to broader market. But IPO does not give them ability to borrow at a lower interest rate it rather provides more funds from stocks to pay up existing debts.