Question: Which of the following statement does not explain why many IPOs are underpriced? Multiple Choice Underpricing is used to counteract the winner's curse and encourage

Which of the following statement does not explain why many IPOs are underpriced? Multiple Choice Underpricing is used to counteract the "winner's curse" and encourage the average investors to purchase the new Issue Underpricing is used to counteract the uncertainty effects of smaller riskler firms. Underpricing insures the investment dealers against future lawsults by customers claiming that they have bought overpriced securities Underpricing parallels the efficient market hypothesis

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