The most important function of an underwriter is to:

Question

Quizplus · Accepted Answer

The most important function of an underwriter is to buy the securities issue from the firm and then resell them to the public. This process is known as underwriting, and the underwriter assumes the risk involved in the marketability of the securities. The underwriter earns a fee or a percentage of the offering amount, which is the difference between the offering price and the price paid to the issuer. While the underwriter may also be involved in assessing the firm's capital needs, providing private placements and approving the prospectus before distribution to the public, their primary function is to underwrite and distribute securities to the public.

The Most Important Function of an Underwriter Is To