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Suppose you are the lead underwriter for a start - up company. The company plans to sell 1 0 million shares at the price of

Suppose you are the lead underwriter for a start-up company. The company plans to sell 10 million shares at the price of $46 per share. It also provides you an over-allotment option of 1.5 million additional shares. Recent road show estimates demand to be around 20 million shares at $46. There is lots of uncertainty about how the stock will perform after trading starts. Consider the following decisions. 18. Before the trading starts tomorrow, you need to allocate (sell) a number of shares to the institutional investors now at the IPO price. How many shares will you allocate? a.9 million shares b.10 million shares c.11.5 million shares d.15 million shares e.20 million shares

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