Answered

What is the primary reason to issue stock?

A)To help investors earn a higher rate of return

B)To raise money to grow the company

C)To distribute the risk of bankruptcy across more investors

D)To increase investor awareness of the company

Verified Answer :

to raise money to grow the company

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Answer:

The answer is: B) To raise money to grow the company

Explanation:

Corporations issue stock to raise money and increase its equity. They use this "extra money" to fund investment projects that should make the corporation grow. For example, a retail chain can issue stock to raise money for building and equipping new warehouses.

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