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WAEC Commerce 1998 Question 60

Question 60

Stock Exchange

When a company sells its shares to an issuing house which later sells to the public, it is called

  1. A.an offer for sale
  2. B.a rights issue
  3. C.a public issue
  4. D.an issue by prospectus
  5. E.a private placing
Show the answer and explanation

Answer: A (an offer for sale)

Explanation

In an offer for sale, an issuing house buys the shares and resells them to the public.