When Making an Issue of Shares to the Public

question 33

Multiple Choice

When making an issue of shares to the public:

• A)it is generally easy to set the price at which the shares will be issued.
• B)it is generally difficult to set the price at which the shares will be issued.
• C)if the share price is set too low, the issue will be undersubscribed.
• D)if the share price is set too high, the issue will be oversubscribed.

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Definitions:

Probability

The measure of the likelihood that an event will occur, quantified as a number between 0 and 1.

Fair Insurance Policy

An insurance contract that is both equitable to the insurer and insured, ensuring that the terms and conditions are just and reasonable to all parties involved.

Premium

The amount paid periodically to the insurer by the insured for covering his risk.

Expected Income

The amount of money an individual or entity anticipates earning over a certain period.