Chapter 20, Problem 14CQ

Summary Introduction

To explain: The reasons for shelf registration used by many companies in place of syndication.

Bond:

Bond refers to the securities which are traded in the public to raise the capital when needed. It is an investment with a fixed income where an investor gives money to an entity or individual for a specified period of time at a fixed rate.

Underpricing:

The underpricing term refers to the offering of the stocks or the bond at a low price than before. The stocks or the debt are said to be underpriced when they are traded at a lower

Shelf registration:

The shelf registration is a permit where a company by the way of initial public offering can sell or offer securities without issuing prospectus for every offering. The company gets a permit when it registers those offerings which it expects to be sold within the coming two years.