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In a publicly traded organization, does the valuation of owners’ equity represent the worth of the organization to its owners? explain your answer

Sagot :

In a publicly traded organization, the valuation of owners’ equity represent the worth of the organization to its owners after "liabilities are deducted from assets."

What is publicly traded organization?

An organization whose shareholders are entitled to a share of the firm's assets and revenues is referred to as a public company, also known as a publicly traded company.

Some characteristics of publicly traded organization are-

  • Ownership of such a public corporation is divided among the public shareholders through the free exchange of stocks that are traded via stock exchanges and the over (OTC) marketplaces.
  • Many Americans make direct investments in public corporations, and chances are good that the pension plan or mutual fund you own, if you have one, has some shares in public companies.
  • A publicly traded corporation is expected to periodically expose its business and financial information to the public in addition to having its securities listed on public exchanges.
  • An initial public offering (IPO) is the procedure used by a private firm to start issuing new shares to the general public. A firm is deemed private before its IPO.
  • A company's decision to start issuing to the general public through with an IPO is crucial since it gives them a source of funding for their expansion.

To know more about publicly traded organization, here

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