In an IPO, the ___Option Allows the Underwriter to Sell

question 1

Multiple Choice

In an IPO, the ___option allows the underwriter to sell additional shares if it is profitable to do so.

• A)overallotment
• B)offer extension
• C)continuance
• D)prolongation

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Definitions:

Vertical Merger

A merger in which a company at one level of the manufacturing-distribution system acquires a company at another level of the system.

Tying Arrangement

Illegal agreement in which the sale of one product is tied to the sale of another.

Antitrust Laws

Legislation enacted to promote competition and prevent monopolies by regulating anti-competitive business practices.

Scuba Gear

Equipment used for underwater diving that allows a diver to breathe underwater, typically including items such as a mask, fins, regulator, and an air tank.