Consider the Following Two Statements: (I) in a Shelf Cash

question 58

Multiple Choice

Consider the following two statements: (i) In a shelf cash offer, can elect to award the underwriting contract through a public auction instead
Of negotiation.
(ii) A standby rights issue is the same as a pre-emptive rights issue, except that the net proceeds are
Guaranteed in the latter.

• A)(i) is correct, (ii) is incorrect.
• B)(i) is incorrect, (ii) is correct.
• C)Both (i) and (ii) are correct.
• D)Both (i) and (ii) are incorrect.
• E)(ii) is incorrect, (i) is correct if the auction is private.

---

Definitions:

ATC

Average Total Cost, which is calculated by dividing the total cost of production by the quantity of output produced.

Influence on Price

The ability of buyers or sellers to affect the price of a good or service in the market, often due to factors like monopoly power, supply and demand dynamics, or government intervention.

Economic Losses

Financial losses incurred due to unfavorable business conditions, natural disasters, or other unexpected events that negatively impact the economy.

Implicit Cost

The opportunity cost equal to what a firm must give up in order to use resources it owns, without paying rent or borrowing costs.