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Why Would the Managers of a Firm Bundle Options with Stock

Question 47

Multiple Choice

Why would the managers of a firm bundle options with stock in an IPO?


A) To increase the supply of outstanding shares in order to attract more investors
B) To promote the dilution of common stockholders' control on assets
C) To reduce the number of common shares that must be sold at the IPO price in order to raise the amount of money that the firm needs
D) To bring down the earnings per share of common stockholders

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