Chapter 15, Problem 1PS

a)

Summary Introduction

To choose: One of the following issue methods that more likely to employ the method.

Explanation of Solution

Given information:

For rights issue – initial public offering or further sale of an already publicly traded stocks.

Selection of more likely to employ this method:

For rights issue, the better option is further sale of an already publicly traded stock.

b)

Summary Introduction

To choose: One of the following issue methods that more likely to employ the method.

Explanation of Solution

Given information:

For the rule 144A issue – international bond issue or U.S bond issue by foreign corporations.

Selection of more likely to employ this method:

Based on the rule 144A issue, U.S bond issue by foreign corporations is more likely to employ.

c)

Summary Introduction

To choose: One of the following issue methods that more likely to employ the method.

Explanation of Solution

Given information:

For private placement – bond issue by an industrial company or issue of existing stocks.

Selection of more likely to employ this method:

For private placement, bond issue by an industrial company is more suitable.

d)

Summary Introduction

To choose: One of the following issue methods that more likely to employ the method.

Explanation of Solution

Given information:

For shelf registration – bond issue by larger industrial company or initial public offer.

Selection of more likely to employ this method:

For shelf registration - bond issue by a large company are more likely to employ.