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28.
Which one of the following is probably the most successful means of finding venture
capital?
29.
Which one of the following statements concerning venture capital financing is correct?
30.
Which one of the following statements concerning venture capitalists is correct?
31.
Which of the following should be considered when selecting a venture capitalist?
I. level of involvement
II. past experiences
III. termination of funding
IV. financial strength
32.
Trevor is the CEO of Harvest Foods, which is a privately-held corporation. What is the first
step he must take if he wishes to take Harvest Foods public?
33.
All new interstate security issues are regulated by the:
34.
The Securities and Exchange Commission:
35.
Underwriters generally:
36.
With firm commitment underwriting, the issuing firm:
37.
With Dutch auction underwriting:
38.
If an IPO is underpriced then the:
39.
Which of the following have been offered as supporting arguments in favor of IPO
underpricing?
I. Underpricing counteracts the "winner's curse".
II. Underpricing rewards institutional investors for sharing their opinions of a stock's
market value.
III. Underpricing diminishes the underwriting risk of a firm commitment underwriting.
IV. Underpricing reduces the probability that investors will sue the underwriters.
40.
Which one of the following is a key goal of the aftermarket period?
41.
Which one of the following statements is correct?
42.
An individual investor with a small portfolio who wishes to purchase 100 shares of each
IPO is more likely to receive an allocation of shares when:
43.
When a firm announces an upcoming seasoned stock offering, the market price of the
firm's existing shares tends to:
44.
The total direct costs of underwriting an equity IPO:
45.
Which one of the following statements is correct concerning the costs of issuing
securities?
46.
Existing shareholders:
47.
To purchase shares in a rights offering, a shareholder generally just needs to:
48.
The value of a right depends upon:
I. the number of rights required to purchase one new share.
II. the market price of the security.
III. the subscription price.
IV. the price-earnings ratio of the stock.
49.
Before a seasoned stock offering, you owned 7,500 shares of a firm that had 500,000
shares outstanding. After the seasoned offering, you still owned 7,500 shares but the
number of shares outstanding rose to 625,000. Which one of the following terms best
describes this situation?
50.
Which one of the following statements concerning dilution is correct?
51.
Which one of the following statements is correct concerning the issuance of long-term
debt?
52.
Shelf registration allows a firm to register multiple issues at one time with the SEC and
then sell those registered shares anytime during the subsequent:
53.
Aaron's Sailboats has decided to take the company public by offering a total of 120,000
shares of common stock to the public. The firm has hired an underwriter who arranges a
full commitment underwriting and suggests an initial selling price of $25 a share with a 7
percent spread. As it turns out, the underwriters only sell 97,400 shares. How much cash
will Aaron's Sailboats receive from its first public offering?
54.
Nelson Paints recently went public by offering 65,000 shares of common stock to the
public. The underwriters provided their services in a best efforts underwriting. The offering
price was set at $16 a share and the gross spread was $2. After completing their sales
efforts, the underwriters determined that they sold a total of 57,500 shares. How much
cash did Nelson Paints receive from its IPO?
