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firm wants to raise $15 million by selling 1 million shares at a net price of $15. We know that some say that firms "leave money on the table"...
A U.S. firm wants to raise $15 million by selling 1 million sharesat a net price of $15. We know that some say that firms “leavemoney on the table” because of the phenomenon of underpricing.a. Using the average amount of underpricing in U.S. IPOs, howmany fewer shares could it sell to raise these funds if the firmreceived a net price per share equal to the value of the sharesat the end of the first day’s trading?b. How many less shares could it sell if the IPO was occurring inGermany?c. How many less shares could it sell if the IPO was occurring inKorea?d. How many less shares could it sell if the IPO was occurring inCanada?
