The out-of-pocket expenses incurred by security brokers

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Reference no: EM131020256

Security Brokers, Inc., specializes in underwriting new issues by small firms. On a recent offering of Beedles, Inc., the terms were s follows:

Price to public $5 per share

Number of shares 3 million

Proceeds to Beedles $14,000,000

The out-of-pocket expenses incurred by Security Brokers in the design and distribution of the issue were $300,000. What profit or loss would Security Brokers incur if the issue were sold to the public at the following averge price?

a. $5 per share

b. $6 per share

c. $4 per share

Reference no: EM131020256

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