Final answer:
An initial public offering (IPO) is the first sale of shares of stock by a firm to outside investors. It is conducted on a trading platform, such as a stock exchange.
Step-by-step explanation:
An initial public offering (IPO) is the first sale of shares of stock by a firm to outside investors. In an IPO, a company sells its own stock to the public, including individuals, mutual funds, insurance companies, and pension funds. The IPO is conducted on a trading platform, such as a stock exchange, where buyers and sellers can trade the shares.