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BeerBrew is planning an IPO. Under the terms of the IPO, BeerBrew will issue 12 million shares at an offer price of $35 per share.

BeerBrew is planning an IPO. Under the terms of the IPO, BeerBrew will issue 12 million shares at an offer price of $35 per share. The underwriter charges an 8% underwriting fee and direct costs are estimated to be $6 million. The stock is expected to trade at $40 at the end of the first trading day. Question 1. What is the total amount of funds raised through the IPO? Question 2. What is the initial return earned by investors on this IPO? Question3. What are the total underwriting fees for this IPO?

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