What is the major reason that underwriters tend to offer stocks in an IPO at a price that is below that which the market will pay?

Question

Quizplus · Accepted Answer

Underwriters tend to offer stocks in an IPO at a price below the market price because it reduces their exposure to losses from unsold stock. By offering the stock at a lower price, they ensure that there is demand for the stock, reducing the risk of having unsold shares.

Answer: C 
 Underwriters also benefit from greenshoe provisions, which allow them to sell additional shares if demand for the stock is high. By offering the stock at a lower price, there is a higher likelihood that demand will be strong and the greenshoe provision can be exercised.

What Is the Major Reason That Underwriters Tend to Offer