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Widget Inc, just offered shares in the initial public offering. The issue was 1 0 0 , 0 0 0 shares and the underwriting syndicate

Widget Inc, just offered shares in the initial public offering. The issue was

100, 000

shares and the underwriting syndicate charged fees of $

45, 000 .

Shares started trading

at $

35,

but immediately jumped to $

38 .

What is the total cost of share issuance to

Widget Inc? Is this cost equal to the profit of the underwriting syndicate?

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