Question 1 1 pts An OR winery decided to raise capital through IPO. The company has 1000 shares outstanding, and each was valued at $100. CEO proposed to issue 1000 more shares. The IB set the offering price at $100 a share, the shares opened at $100, and quickly jumped to $130, the closing price on the first day of trading was $110. What was the underpricing? What is the total market value of equity in the winery after the IPO? 10%, 220 000 30%, 220 000 10%, 210 000 30%, 210 000 Question 2 1 pts The company decided to increase its leverage permanently. To do that, it issued new bonds worth $100mln. The company's marginal tax rate is 21%. Prior to the leverage change the company was all equity financed, it had 10mln shares outstanding, trading at $100. The company decided to use proceeds from issue of bonds to buy back shares. At what price would the company buy back shares? 0110 O 100 90 102.1 92.1 Question 3 1 pts Company's equity beta before restructuring was 1.1. Risk-free rate is 4.48%, market risk premium is 6%. The company issued new bonds with 4% coupon, and distributed proceeds as dividends. The leverage ratio increased from 10% to 20%. Tax rate is 0.21. What is the new WACC? [enter your answer in %, with two decimal points precision]