Question

In a _________, the underwriters agree to make an attempt to sell the IPO for the firm. If the underwriter can get enough investor commitments then the IPO will occur. If sufficient investor interest does not exist the issue may be canceled

Answer 1

best efforts

Step-by-step explanation:

As it name suggests, a best efforts IPO takes place when an underwriter cannot commit completely to a client because the market interest in the firm is not certain. So the underwriter "promises" to make its best effort to carry out a successful IPO, but cannot guarantee it. On the other hand, when the market interest is very large, underwriters themselves purchase the entire IPO through a firm commitment IPO.