Use the Following Information to Answer the Question(s)below

question 14

Multiple Choice

Use the following information to answer the question(s) below.
Wyatt Oil has 8 million shares outstanding and is about to issue 10 million new shares in an IPO.The IPO price has been set at $15 per share,and the underwriting spread is 6%.The IPO is a big success with investors,and the share price rises to $35 on the first day of trading.
-The amount that Wyatt Oil pays as an underwriting spread is closest to:

• A)$6 million.
• B)$7 million.
• C)$9 million.
• D)$17 million.
• E)$21 million.

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Definitions:

Vroom-Jago

A decision-making model that emphasizes the importance of leadership styles and situational factors in making effective decisions.

Leader-Participation Model

A leadership theory suggesting the effectiveness of a leader's decision-making is influenced by the appropriate involvement of subordinates.

Delegate

To entrust a task or responsibility to another person, typically one who is less senior in the organization.

Pollution Permit

A regulatory tool allowing entities to emit a specific amount of pollutants; often tradeable within a regulated market.