David Founds a Company and Goes Through the Investment Rounds

question 57

Multiple Choice

David founds a company and goes through the investment rounds shown below: He decides to take the company public through an IPO, issuing 2 million new shares. Assuming that he successfully completes the IPO, the net income for the next year is estimated to be $8 million. His banker informs him that the price of shares should be set using average price-earnings ratios for similar businesses, which is 15.0. What will be the IPO price per share?

• A)$20.25
• B)$33.33
• C)$60.00
• D)$3.40

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Definitions:

Masculine Characteristics

Traits traditionally associated with men, such as assertiveness, competitiveness, and physical strength, often discussed in the context of gender roles and expectations.

Good Manager

A person who effectively leads, guides, and supports their team towards achieving goals while maintaining a positive work environment.

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The process of making something more English in style, language, or culture.

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