Under the best efforts approach a bank guarantees that the firm will sell all of its securities at a high enough price to meet its financial goals.

Question

Quizplus · Accepted Answer

Under a best efforts approach, the bank agrees to use its best efforts to sell the securities but does not guarantee that all securities will be sold at a specific price or at all. The risk of selling the securities lies with the issuer, not the bank.

Under the Best Efforts Approach a Bank Guarantees That the Firm