An Underwriter Sells 2 Million Shares of Stock to the Public

question 43

Multiple Choice

An underwriter sells 2 million shares of stock to the public at $40 per share.The issuing firm receives $73 million before non-underwriting costs.

• A) The underwriter's spread was 2.14%.
• B) The underwriter's spread was $40.
• C) The underwriter's spread was 8.75%.
• D) The underwriter's spread was 9.59%.

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