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True, relative to an owner-managed firm, a publicly traded firm has higher agency costs and more efficient risk-bearing.
What is a publicly traded firm?
A corporation whose ownership is structured using shares of stock meant for free trading on a stock exchange or in over-the-counter markets is referred to as a public company, publicly traded company, publicly held company, publicly listed company, or public limited company. A public firm (one that is traded publicly) has the option of being listed on a stock exchange (a listing allows for easier share trading) or not (unlisted public company). Public firms that exceed a specific size must list on an exchange, according to various regulations. The term "public" stresses the reporting and trading on public markets of private businesses, which make up the majority of public corporations.
Due to the fact that public corporations are created under the specific state's legal framework, they have affiliations and formal designations that are different from and separate from the polity in which they are located. For instance, a public company is typically a type of corporation in the United States (though a corporation need not be a public company), a public limited company is typically a type of corporation in the United Kingdom, a "société anonyme" (SA) is a type of corporation in France, and an Aktiengesellschaft is a type of corporation in Germany (AG). Even if there may be some broad similarities across public companies, there are nevertheless important distinctions that are at the heart of legal conflicts involving commerce and industry that are governed by international law.
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relative to an owner-managed firm, a publicly traded firm has higher agency costs and more efficient risk-bearing. group of answer choices true false
