The Six Components That Make Up the Total Costs of New

question 30

Multiple Choice

The six components that make up the total costs of new issues are:

• A)the spread; other direct expenses such as filing fees; indirect expenses such as management time; economies of scale; abnormal returns and the Green Shoe option.
• B)the discount; other direct expenses such as filing fees; indirect expenses such as management time; due diligence costs; abnormal returns and the Green Shoe option.
• C)the spread; other direct expenses such as filing fees; indirect expenses such as management time; abnormal returns; underpricing and the Green Shoe option.
• D)the spread; other direct expenses such as filing fees; economies of scale; due diligence costs; abnormal returns and underpricing.
• E)None of the above.