Which of the Following Is Not the Responsibility of the Lead

question 18

Multiple Choice

Which of the following is not the responsibility of the lead underwriter for an equity issuance?

• A) price stabilization of the issue
• B) exercises discretion over the distribution of shares for sale among the syndicate and the selling group
• C) must buy the shares in the green shoe option
• D) many times serves as the market maker for trading in the issuers securities

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Definitions:

Common Stock

A type of security that represents ownership in a corporation, with holders having a claim on the company's assets and earnings.

Preemptive Right

The right of existing shareholders to purchase additional shares before the company offers them to the public, maintaining their proportional ownership.

Common Shareholder

A common shareholder is an individual or institution that owns common shares in a company, giving them rights to vote at shareholder meetings and to receive dividends.

New Stock

Shares that have been issued to the public for the first time through an initial public offering (IPO) or additional issuance.