What is the term for the first public offering of a corporation's stock?

• A. Initial Public Offering (IPO)
• B. Secondary Offering
• C. Private Placement
• D. Seasoned Equity Offering

Answer: (A)

The main idea is the first time a company sells stock to the public, which is called an Initial Public Offering. This sets the stage for trading on a public market and involves inviting a broad pool of investors through underwriting and pricing.

After the IPO, other terms describe different scenarios: a secondary offering involves selling more shares after the company is already public (often by the company or existing shareholders), a private placement is selling shares to a small, private group rather than the general public, and a seasoned equity offering is a new issuance by a company that is already public to raise additional capital. Because the question asks for the first public sale of stock, Initial Public Offering (IPO) is the correct term.