The Key Differences Between a Negotiated Offer and a Competitive

question 38

Multiple Choice

The key differences between a negotiated offer and a competitive offer is that:

• A)the underwriters can not set the spread in a negotiated bid but can in a competitive offer.
• B)the issuing firm can offer its security to the highest bidder in a competitive bid but in a negotiated bid only one investment banker is used.
• C)the issuing firm work the underwriter for the best spread in a negotiated bid which will be less than available in a competitive offer.
• D)the underwriter will not do a full investigation in negotiated bid because the company is at their mercy while in a competitive bid the underwriter must be extra diligent.
• E)None of the above.