9) Which of the following best describes a firm esells it a) The underwriter purchases the entire issue and the l in an onlint commitment PO? b) The underwriter sells new issues directly to t c) The underwriter tries guarantee that the stock will be sol to sell the stock for the best possible price but does not there is sufficient demand to sell the entire issue. solicits bids from investors and chooses the highest price at which 10) Which of the following statements is FALSE? a) The b) Public the public markets two advantages of going public are greater liquidity and better access to capital companies typically have access to much larger amounts of capital through The process of selling stock to the public for the first time is called an Initial Public Offerings (IPO) d) None of the above statements is false 11) What is the major reason that underwriters tend to offer stocks in an IPO at a price that is below that market price? a) To reduce their exposure to losses from unsold stock b) To increase the gains of underwriting c) To increase the leverage ratio d) All of the above are correct 12) What is the possible explanation behind the decline in stock prices when new equity is issued a) Signaling and managerial information b) Signaling and debt usage c) Issue costs