Which one of the following statements concerning IPOs and underpricing is correct?
A) IPO underpricing primarily benefits a firm's pre-issue owners.
B) The more an issue is underpriced,the more it tends to be oversubscribed.
C) IPO underpricing is a function of the underwriting fee.
D) Underpricing tends to discourage investors from participating in the IPO market.
E) Undersubscribed shares generally tend also to be underpriced shares.
Correct Answer:
Verified
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