.

Why do corporations employ investment bankers?

2.

Identify the primary market functions of investment bankers.

3.

Discuss how investment bankers assume risk in the process of marketing securities of corporations. How do investment bankers try to minimize these risks?

4.

Briefly describe the process of competitive bidding and discuss its relative advantages and disadvantages.

5.

Explain market stabilization.

6.

Identify the costs associated with going public.

7.

Briefly describe how investment banking is regulated.

8.

Describe the inroads into investment banking being made by commercial banks.

9.

In 2003, several investment banking firms were fined $1.4 billion for ethics abuses related to the underwriting process. Will this be a deterrent for ethical lapses?

10.

What were some of the reasons for the decline in Facebooks stock price after its IPO?

11.

What are some of the characteristics of an organized securities exchange?

12.

Describe the types of members of the New York Stock Exchange (NYSE).

13.

Why is there a difference between bid and ask prices at some point in time for a specific security?

14.

Describe the differences among the following three types of orders: market, limit, and stop loss.

15.

What is a short sale?

16.

Describe buying on margin.