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What profit or loss would security brokers incur

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Profit or Loss on New Stock Issue

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

Price to public:$5 per share

Number of shares:3 million

Proceeds to Beedles:$14,000,000

Question 1: The out-of-pocket expenses incurred by Security Brokers in the design and distribution of the issue were $310,000. What profit or loss would Security Brokers incur if the issue were sold to the public at the following average price?

A. $5 per share? Use minus sign to enter loss, if any.

B. $6.75 per share? Use minus sign to enter loss, if any.

C. $4 per share? Use minus sign to enter loss, if any.

Reference no: EM132584786

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