An investment banker makes money from
A) commissions from buyers.
B) fees from other investment bankers in the syndicate.
C) the spread between issue price and proceeds to the issuer.
D) artificially supporting the stock price during and after the offering.

Question

Quizplus · Accepted Answer

An investment banker typically makes money by charging a spread, which is the difference between the issue price of a security and the proceeds that are received by the issuer. This spread may vary depending on market conditions and the complexity of the offering. Investment bankers may also earn fees from other investment bankers in a syndicate, although this is not the primary source of income. Commissions from buyers and artificially supporting the stock price are not typical ways that an investment banker makes money.

An Investment Banker Makes Money from