Which of the Following Have Been Offered as Explanations of IPO

question 63

Multiple Choice

Which of the following have been offered as explanations of IPO underpricing? I.Underpricing helps offset the "winner's curse."
II) Underpricing helps ensure investors will be long-term holders of the IPO securities.
III) Underpricing helps ensure investment bank customers will earn a profit on average.
IV) Underpricing is needed to convince investors to accept the risks associated with IPOs.

• A)II only
• B)IV only
• C)II and III only
• D)I,III,and IV only
• E)I,II,III,and IV only

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