Market stabilization
A)is the action by the managing investment banker to keep the price of newly issued securities from falling below the issue price to the public.
B)usually lasts 2 to 3 days, but can last up to 30 days if a security is difficult to distribute.
C)cannot always maintain high initial prices-a case in point being the Facebook issue, sold in May of 2012.
D)All of these options

Question

Quizplus · Accepted Answer

Market stabilization is the action taken by investment bankers to prevent the price of newly issued securities from falling below the issue price. This typically lasts 2 to 3 days but can last up to 30 days if the security is difficult to distribute. However, market stabilization is not always successful, as evidenced by the Facebook issue in May 2012, where the initial prices could not be maintained. Therefore, all of the options are correct.

Market Stabilization