The most important service provided by underwriters is

Question

Quizplus · Accepted Answer

Underwriters play a crucial role in reducing information asymmetry between the issuer of securities and the investors by conducting due diligence and verifying the accuracy of information provided in the prospectus. This reduces information costs for investors and increases the efficiency of the market. While underwriters may also provide insurance services, their primary function is to act as intermediaries between issuers and investors in the securities market. Neither (B) dealing with problems of moral hazard, nor (C) insuring firms against loss from fire, nor (D) insuring firms against loss from employee theft are the most important service provided by underwriters.

The Most Important Service Provided by Underwriters Is