A corporation wishing to raise funds will normally want the investment banker to use a "best efforts" arrangement rather than a negotiated basis.

Question

Quizplus · Accepted Answer

A corporation wishing to raise funds would typically prefer a negotiated basis (or firm commitment) over a "best efforts" arrangement because, in a negotiated basis, the investment banker guarantees the sale of the securities at a specific price, providing more certainty of funds to the corporation.

A Corporation Wishing to Raise Funds Will Normally Want the Investment