Multiple Choice
Two companies have both announced IPOs at $16.50 per share.One of these is undervalued by $2, and the other is overvalued by $1.60, but you have no way of knowing which is which.You previously placed an order for 1,000 shares of each issue.If an issue is undervalued, it will be rationed, and only half your order will be filled.What profit do you now expect?
A) -$375
B) -$600
C) $25
D) $150
E) $400
Correct Answer:
Verified
Correct Answer:
Verified
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