Final answer:
Under a full-underwriting arrangement, a syndicate of investment bankers buys and ensures the sale of an entire security issue before reselling to the public, absorbing the associated risks.
Step-by-step explanation:
When a syndicate of investment bankers participates in buying and reselling a security issue under a full-underwriting arrangement, the syndicate guarantees the sale of the securities by purchasing the entire issue from the issuer and then reselling it to the public. This means that the syndicate absorbs the risk of not being able to sell the entire issue at the stipulated price. Investment bankers play a crucial role in regulating and supervising the sale of securities, ensuring that securities are offered to those who demand it. They facilitate the flow of capital by turning deposits into loans for companies and by allowing firms to raise capital through the sale of stock and bonds.