What pro?t do you actually expect

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Question: The Woods Co. and the Spieth Co. have both announced lPOs at $40 per share. One of these is undervalued by $9, and the other is overvalued by $4, but you have no way of knowing which is which. You plan to buy 1,000 shares of each issue. If an issue is underpriced, it will be rationed, and only half your order will be filled.

a. If you could get 1,000 shares in Woods and 1,000 shares in Spieth, what would your profit be?

b. What pro?t do you actually expect?

Reference no: EM132756999

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