How is the investment banker compensated?

Question

Quizplus · Accepted Answer

Investment bankers are compensated by the spread between the purchase and sale price of the security they are marketing, which is commonly referred to as the underwriting spread. This is typically a percentage of the total value of the securities being offered to the public. The investment banker earns a profit by buying the securities from the issuer at a lower price and then selling them to investors at a higher price.

How Is the Investment Banker Compensated