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Garcia Guitars and Weir Whiskey have announced IPOs at respective prices of $20 and $40. Ones stock price will decrease by $4 and the others

Garcia Guitars and Weir Whiskey have announced IPOs at respective prices of $20 and $40. Ones stock price will decrease by $4 and the others will increase by $10 but you dont know which is which. You plan on buying 8 shares of both. The underpriced IPO will be oversubscribed meaning your requested shares will be rationed and youll only get half of what you purchased but your other order will be fulfilled. There is a 50% chance each one will be oversubscribed. a. What percent return would you expect to earn if there was no share rationing? b. What percent return would you expect to earn given the share rationing?

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