Question 1. Aerospace Z is a private firm that recently went public. The managers of the firm have decided to undertake a Dutch IPO to sell 1,000,000 shares. The following table summarises all the bids the firm received. (27 marks) Dutch IPO a) What is the IPO price? (2 marks) b) What is the number of shares allocated to each investor? (14) c) How much money does Aerospace Z raise from the IPO? (2 marks) d) If the IPO represented 50% of total value of the firm, what is the percentage of Aerospace Z owned by investor A? (3 marks) e) If the stock price rises by 20% the day after the IPO, what is the dollar amount of the profit investor A makes? ( 3 marks) f) Given the 20% increase in the price of the stock after the IPO day, there are rumors that the underwriters did not do a good job in pricing the stock, hence underpricing the security. How much money is left on the table due to this underpricing? ( 3 marks) Question 1. Aerospace Z is a private firm that recently went public. The managers of the firm have decided to undertake a Dutch IPO to sell 1,000,000 shares. The following table summarises all the bids the firm received. (27 marks) Dutch IPO a) What is the IPO price? (2 marks) b) What is the number of shares allocated to each investor? (14) c) How much money does Aerospace Z raise from the IPO? (2 marks) d) If the IPO represented 50% of total value of the firm, what is the percentage of Aerospace Z owned by investor A? (3 marks) e) If the stock price rises by 20% the day after the IPO, what is the dollar amount of the profit investor A makes? ( 3 marks) f) Given the 20% increase in the price of the stock after the IPO day, there are rumors that the underwriters did not do a good job in pricing the stock, hence underpricing the security. How much money is left on the table due to this underpricing? ( 3 marks)