FIN 423 Quiz #1
Take-home, due at the beginning of class on Wednesday, April 16, 1997
Write a brief answer to the following questions. Try to relate
your answers to the information in the attached article from Fortune and to the readings and class discussion in FIN 423. Limit your answers to no more than three (3) double-spaced (10 point fonts or larger and 1" margins on all sides) pages.
- What were the main reasons that Microsoft chose to have an
initial public offering (IPO) of common stock? Did their reasons
differ from more typical IPO's? If so, why and how?
- Microsoft's stock price rose dramatically after the IPO.
Was this a loss to Microsoft? Why or why not?
- What did Microsoft do to try to avoid the "underpricing
problem"? Can you suggest other things they might have done?
- What role, if any, did the federal securities laws play in exacerbating the problem of getting Microsoft's stock priced correctly at the IPO? [Hint: If there was no agency called the S.E.C., how might Bill Gates have sold Microsoft stock? Would this have resulted in a better price for Microsoft at the offering?]
A full-text version of this quiz is available in Acrobat's portable data format (.pdf).
The file is about 1,031K and can only be viewed (and printed) using a copy of Acrobat Reader.
If you do not have a copy of this program, you may download a program that works for Windows 95 or NT now [this is a self-extracting ZIP file that you must install on your computer to read PDF files]. If you want the current version of the Adobe Acrobat Reader for other platforms, visit Adobe's web page.
Click here to download this quiz.
Click here to see the histogram showing the grades for this quiz.
A histogram showing the grades for this quiz is available in Acrobat's portable data format (.pdf).
The file is about 137K and can only be viewed (and printed) using a copy of Acrobat Reader.
Click here to download this graph.
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Last Updated on 4/7/97
© Copyright 1997, G. William Schwert