A public limited company can raise higher levels of capital by selling shares to the public.

• A. True
• B. It can raise higher levels of capital
• C. False
• D. It cannot raise capital

Answer: (A)

Public limited companies can raise large sums by issuing and selling shares to the public, because they are allowed to offer ownership stakes to a wide range of investors and access funds from public markets. This ability to attract equity from many shareholders enables much higher capital than private companies typically obtain, which are more limited in who they can sell shares to. So the statement is true. (Issuing new shares is equity finance and can dilute existing ownership, and it comes with regulatory requirements, but the fundamental idea is that selling shares publicly unlocks much larger capital.)