Question: Batman Enterprises has just completed an initial public offering. The firm sold 1,400,000 new shares at an offer price of $19.00 per share. The underwritering

Batman Enterprises has just completed an initial public offering. The firm sold 1,400,000 new shares at an offer price of $19.00 per share. The underwritering spread was $1.29 a share. The firm incurred $175,000 in legal, administrative, and other costs. Suppose that on the first day of trading, the price of Batman's stock is $23.00 per share. What is the cost to the firm from the underpricing? .

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