Kite Flyers recently offered 6,000 shares of stock for sale but only received payment from its underwriters for the 4,500 shares they sold.This must have been a ________ underwriting.

Question

Quizplus · Accepted Answer

In a "best efforts" underwriting, the underwriter does not guarantee the sale of all the shares but agrees to sell as many as possible. Here, only 4,500 out of 6,000 shares were sold, indicating a best efforts agreement.

Kite Flyers Recently Offered 6,000 Shares of Stock for Sale