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A broker-dealer is a syndicate member in a best efforts underwriting of ABC Common stock. The issue is oversubscribed. The broker-dealer may allocate sales of the issue to:I employees of the issuerII employees of the broker-dealerIII officers of the issuerIV officers of the broker-dealerA. I and IIIB. I and IVC. II and IIID. II and IV

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Answer:

A broker-dealer is a syndicate member in a best efforts underwriting of ABC Common stock. The issue is oversubscribed. The broker-dealer may allocate sales of the issue to:

A. I and III

Explanation:

  • A broker-dealer is defined as a company or an individual who do the business of selling and buying of the securities for its customer on their behalf or for himself.
  • The correct option A because as the broker dealer is a syndicate member and the issue is oversubscribed. So, the broker-dealer can allocate the sales of issues to only employee of the issuer and officers of the issuer.