1. You need to choose between making a public offering and arranging a private placement. In each case the issue involves $10 million face value of 10-year debt. You have the following data for each:

• A public issue: The interest rate on the debt would be 8.5%, and the debt would be issued at face value. The underwriting spread would be 1.5%, and other expenses would be $80,000.
• A private placement: The interest rate on the private placement would be 9%, but the total issuing expenses would be only $30,000.

a-1.Calculate the net proceeds from public issue. (Enter your answer in dollars not millions of dollars.)

a-2. Calculate the net proceeds from private placement. (Enter your answer in dollars not millions of dollars.)

b-1. Calculate the PV of the extra interest on the private placement. (Do not round intermediate calculations. Enter your answer in dollars not millions of dollars. Round your answer to the nearest whole dollar amount.)

2. Suppose that in April 2019, Van Dyck Exponents offered 100 shares for sale in an IPO. Half of the shares were sold by the company and the other half by existing shareholders, each of whom sold exactly half of their existing holding. The offering price to the public was $50 and the underwriters received a spread of 7%. The issue was heavily oversubscribed and on the first day of trading the stock price rose to $160.

a-1. What were the proceeds of the issue to the company? (Do not round intermediate calculations. Round your answer to the nearest whole number.)

a-2. What were the proceeds of the issue to the shareholders? (Do not round intermediate calculations. Round your answer to the nearest whole number.)

b. How much commission did the underwriters receive? (Do not round intermediate calculations. Round your answer to the nearest whole number.)

c. How much money was left on the table? (Do not round intermediate calculations. Round your answer to the nearest whole number.)

d. What was the cost of the underwriting to the selling shareholders? Round answer to the nearest whole number.)

PLEASE show all working, Thanks.