Problem:
I am having problems trying to understand stock losses. If you were underwriting new issues to small firms and you had a recent offering on a company that had the following terms: Price to public $5 per share, Number of shares 3,000,000, Proceeds 14,000,000
If your out of pocket expenses incurred in the design and distribution of the issue were $300,000. What profit or loss would you incur if the issue were sold to the public at an average price of :
a) $5 per share
b) $6 per share
c) $4 per share