Question

Security Brokers Inc. specializes in underwriting new issues by small firms. On a recent offering of Barenbaum Inc., the terms were as follows:
Price to public ............. $7.50 per share
Number of shares .......... 3 million
Proceeds to Barenbaum ......... $21,000,000
Security Brokers incurred $450,000 in out-of-pocket expenses in the design and distribution of the issue. What profit or loss would Security Brokers incur if the issue were sold to the public at an average price of ...........?
a. $7.50 per share
b. $9.00 per share
c. $6.00 per share



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  • CreatedNovember 24, 2014
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