How Does the Size of an Issue Affect the Fees

Multiple Choice

How does the size of an issue affect the fees charged by underwriters?

A) Although large issues generally have a smaller spread, the total fees for large number of shares released is smaller than that for smaller issues.
B) Large issues generally have a similar spread to small issues and thus attract much greater fees.
C) Large issues have a reduced spread, which means that the total fees are generally the same as for smaller issues.
D) Large issues have substantially larger direct costs and, thus, must charge a larger spread in order to be profitable for the underwriter.