A bank that helps firms to acquire external capital is called a a. commercial ba

Question

A bank that helps firms to acquire external capital is called a a. commercial bank b. savings bank c. investment bank d. credit union 31. 32. Bavarian Brewhouse is planning on going public. Under theu underwriting discount is 7.25%. If the offering price of the stock is set at S 12.50 per share, what is the per share proceeds that Bavarian will receive? a. $11.59 b. $10.67 c. $13.41 d. $12.50 Bavarian Brewhouse is planning on going public. Under the underwriting agreement the underwriting discount is $1.50 per share. If the offering price of the stock is set at $12.50 per share, what is the percentage underwriting discount? a, 8% b, 996 C. 1096 d.12% 33. 34. The dominant source of financing for U.S. corporations is a. debt financing. b. new equity c. internal cash flow d. none of the above. 35. An institution that raises capital by issuing liabilities against itself is a a. financial intermediary. b. financial broker. c. financial agent. d. none of the above. EXTRA (2 points) The 1933 law that prohibited commercial banks from underwriting corporate security issues, as well as a host of other things is a. the Glass-Steagall Act. b. the McFadden Act. c. the Gramm-Leach-Bliley Act. d. none of the above

Explanation / Answer

1) Option [c] 2) Option [a] Per share proceeds = 12.50*(1-0.0725) = $                 11.59 3) Option [d] Percentage of discount = 1.50/12.50 = 12.00% 4) Option [c] 5) Option [a] EXTRA Option [a]

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