D. Pay down debt. QUESTION 11 The Beach Company has a stock price of $30.00 and the company needs to raise $30 million in common stock. Underwriter's informed the company's management that the new issue to the public must be priced at $27.00 because of signaling effects. The underwriters' compensation (flotation expense) for the new stock issue be 7% of the issue price. In addition to the underwriters' fee, The Beach Company will incur underwriting expens of $200,000 for the new issue. How many shares must the firm sell to net $30 million for the company after underwriting and flotation expenses (rounded to the nearest whole share)? A. 1,006,667 shares B. 1,000,000 shares C. 1,202,708 shares OD. 1,111,111 shares QUESTION 12 The efficient portfolio line does not include which combination of risk and return. DA. Low Risk, Low Return B. High Risk High Return