Which of the Following Is NOT True About the Underwriting

question 43

Multiple Choice

Which of the following is NOT true about the underwriting services provided by investment banks?

• A)The most common approach to issuing securities in Australia is on a 'best efforts' basis.
• B)Share issues require the preparation of a prospectus.
• C)In addition to the best efforts contract, issuers can also enter into a standby underwriting agreement.
• D)Under the best efforts method, the underwriter will acquire all unsold securities.
• E)Investment bank fees for underwriting services are usually in the form of a commission.

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Definitions:

Customer

An individual or business that purchases goods or services from a company.

Retailer

A business or individual that sells goods or services directly to consumers, acting as the final link in the supply chain.

In-Transit Merge

Logistics strategy where goods from different suppliers are combined into a single shipment en route to the customer to reduce handling costs and improve efficiency.

Drop-Shipping

A retail fulfillment method where a store doesn't keep the products it sells in stock but instead transfers the customer orders and shipment details to either the manufacturer or a wholesaler, who then ships the goods directly to the customer.