Data from the Marketplace Show That the Shares Sold in an IPO

question 55

Multiple Choice

Data from the marketplace show that the shares sold in an IPO are typically

• A) priced between 2 and 5 percent below the price at which they close at the end of the first day of trading.
• B) priced between 10 and 15 percent above the price at which they close at the end of the first day of trading.
• C) priced between 10 and 15 percent below the price at which they close at the end of the first day of trading.
• D) priced between 2 and 5 percent above the price at which they close at the end of the first day of trading.

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Definitions:

Contractual Advantage

An upper hand or benefit a party has in a deal or agreement due to specific contract terms.

Distributorship

A business authorized to sell or distribute a company's goods or services in a specific area or market.

Radical Innovations

Innovations that represent a significant departure from existing practices and often create new markets or transform existing ones.

World War II

A global conflict that lasted from 1939 to 1945, involving most of the world's nations and resulting in significant historical, political, and socio-economic changes.