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Question 1 1 pts Root Inc, a new data driven car insurance company, held its IPO (went public) on October 28, 2020 selling approximately 2.5
Question 1 1 pts Root Inc, a new data driven car insurance company, held its IPO (went public) on October 28, 2020 selling approximately 2.5 million shares of stock. The first purchase of its public stock were at a price of $28. Today the stock price is $14.25. Which of the following are true? If an investor wants to buy Root's common stock today, they will pay approximately $14.25 per share. O Root began selling its car insurance publicly on October 28, 2020. O When Root Inc. had their IPO on Oct 28, 2020, they had a high cash outflow to pay all the ordinary investors who bought the stock. The original investors in Root's common stock are probably very happy with their stock purchase. Ordinary investors can now buy Root Inc's bonds. Question 2 1 pts The current US Government yield curve is upward sloping (as it has been all year 2020). This tells you Long term US government bonds have higher default risk than corporate bonds. Bonds issue by US corporations have greater prices than US government bonds. O Long term government bond rates are greater than short term government bond rates. O Inflation is expected to fall from current levels. The less time to maturity, the greater the maturity risk of a bond
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