Corporate Finance
Corporate Finance
12th Edition
ISBN: 9781259918940
Author: Ross, Stephen A.
Publisher: Mcgraw-hill Education,
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Chapter 20, Problem 6CQ
Summary Introduction

To determine: The difference in viewing the company after the given changes.

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 price than on which it was issued first for trade.

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On August 19, 2004, Google completed its IPO of 18.5 million shares to the initial investors at $80 per share. The closing price of the stock that same day was $100.00. What was the dollar value of the underpricing associated with the Google IPO? (Round answer to 0 decimal places, e.g. 5,275.)
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