Most public offerings of common stock are made with the assistance of

an investment banker which

1. underwrites the security issue by purchasing the stock shares from

the issuing corporation at an agreed-upon price.

2. bears the risk of selling the stock shares to the public at a profit.

3. requires representation on the Board of Directors of the corporation

that is issuing the stock.

4. A and B and C.

5. A and B.

Each of the following is a variable that is included in the constant growth

stock model EXCEPT

1. the required rate of return (r_s).

2. the next expected dividend (D₁).

3. the constant annual dividend growth rate (g).

4. the risk-free rate of return (R_F).