5. Given you have some opportunity to subscribe in one Initial Public Offering and one Seasoned Equity Offering, which one you would like to implement higher leverage in the subscription procedure? (IPO/SEO) Given the strategy with an estimated return distribution with excess mean 20% and volatility 25% (that is, the theoretical optimal leverage is 320%), what is your suggested leverage? (160%/320%) Why? 6. Which one of the following is a true or false? a) Dividends on preferred stocks are tax-deductible to individual investors but not to corporate investors. b) Common dividends cannot be paid if preferred dividends are in arrears on cumulative preferred stock. c) Preferred stockholders have voting power. d) Investors can sue managers for nonpayment of preferred dividends