Underwriting and other expenses tend to be ____ for a smaller security issue?Multiple choice question.large percentagesmall percentageflat amount
Question
Underwriting and other expenses tend to be ____ for a smaller security issue?
- large percentage
- small percentage
- flat amount
Solution
The answer is "large percentage".
Here's why:
Underwriting and other expenses are costs associated with issuing securities. These costs include fees paid to underwriters, lawyers, accountants, and other professionals involved in the process.
When a company issues a large amount of securities, these costs are spread out over a larger number of securities, resulting in a smaller percentage of the total issue.
However, when a company issues a smaller amount of securities, these costs are spread out over fewer securities. This means that the costs represent a larger percentage of the total issue.
So, underwriting and other expenses tend to be a large percentage for a smaller security issue.
Similar Questions
The underwriting function has increasingly included the _____ dealMultiple choice question.best effortsbought
An increase in variable costs .a.reduces contribution .b.increase margin of safety.c.increases the profit.d.increases p/v ratio .
A 1% improvement in which business variable would have the biggest impact on the bottom line?Select an answer:fixed costpricesales volumevariable cost
Inefficient handling of resources leading to financial issues.Select the correct termRedistributionBudgetingMismanagementAuditing
Accrual of expenses will increase the expense element and will correspondingly increase the liabilityGroup of answer choicesTrueFalse
Upgrade your grade with Knowee
Get personalized homework help. Review tough concepts in more detail, or go deeper into your topic by exploring other relevant questions.