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Emerson Pharmaceutical Corp. needs to raise $120 million in an equity issuance. Roosevelt Medical Corp.s current stock price is $110. The underwriter, Goldman Sachs, advises

Emerson Pharmaceutical Corp. needs to raise $120 million in an equity issuance.

Roosevelt Medical Corp.s current stock price is $110.

The underwriter, Goldman Sachs, advises underpricing the issue 4%.

The underwriters require a spread of $1 per share.

a. How much will Emerson Pharmaceutical Corp. net from each share?

b. What will Goldman Sachs earn as total underwriting spread when Emerson Pharmaceutical Corp. reaches its goal to raise $120 million in equity?

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