SIE Knowledge of Capital Markets Practice Question 29

Correct Answer: A

Explanation:

A: Choice A is correct because a mini-maxi underwriting agreement requires the lead underwriter to sell a determined quantity of securities, or else the agreement will not effective. However, if that quantity is sold, the lead underwriter may sell additional units or shares up to the limit available. Choice B is incorrect because it describes an all or none agreement. Choice C is incorrect because it describes a part or none agreement. Choice D is incorrect because it describes a firm commitment agreement.