Question: Filbeck Corporation plans to issue 1 million shares of new stock. An investment banking firm guarantees a selling price of $18 per share and

Filbeck Corporation plans to issue 1 million shares of new stock. An

Filbeck Corporation plans to issue 1 million shares of new stock. An investment banking firm guarantees a selling price of $18 per share and then expects to sell the stock to investors for $20 per share. What is the underwriting spread and the flotation cost as a percentage of the new issue.

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