Beedles Inc. needed to raise $14 million in an IPO and chose Security Brokers Inc. to underwrite the offering. The agreement stated that Security Brokers would sell 3 million shares to the public and provide $14 million in net proceeds to Beedles. The out-of-pocket expenses incurred by Security Brokers in the design and distribution of the issue were $360,000. What profit or loss would Security Brokers incur if the issue were sold to the public at the following average price? Write out your answer completely. For example, 5 million should be entered as 5,000,000. Round your answers to the nearest dollar. Loss should be indicated by a minus sign. a. $5 per share? $ b. $6.5 per share? $ c. $3.75 per share? $

Essentials Of Investments
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ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
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Chapter1: Investments: Background And Issues
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Profit or Loss on New Stock Issue
Beedles Inc. needed to raise $14 million in an IPO and chose Security Brokers Inc. to underwrite the offering. The agreement stated that Security
Brokers would sell 3 million shares to the public and provide $14 million in net proceeds to Beedles. The out-of-pocket expenses incurred by Security
Brokers in the design and distribution of the issue were $360,000. What profit or loss would Security Brokers incur if the issue were sold to the public at
the following average price? Write out your answer completely. For example, 5 million should be entered as 5,000,000. Round your answers to the
nearest dollar. Loss should be indicated by a minus sign.
a. $5 per share?
$
b. $6.5 per share?
$
c. $3.75 per share?
$
Transcribed Image Text:eBook Profit or Loss on New Stock Issue Beedles Inc. needed to raise $14 million in an IPO and chose Security Brokers Inc. to underwrite the offering. The agreement stated that Security Brokers would sell 3 million shares to the public and provide $14 million in net proceeds to Beedles. The out-of-pocket expenses incurred by Security Brokers in the design and distribution of the issue were $360,000. What profit or loss would Security Brokers incur if the issue were sold to the public at the following average price? Write out your answer completely. For example, 5 million should be entered as 5,000,000. Round your answers to the nearest dollar. Loss should be indicated by a minus sign. a. $5 per share? $ b. $6.5 per share? $ c. $3.75 per share? $
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