Series 79 practice questionmediumSyndicate Formation
Which of the following best describes the role of the agreement among underwriters (AAU) in a syndicate?
- AIt sets the issuer’s responsibility for market stabilization.
- BIt determines the exchange on which the stock will list.
- CIt outlines the issuer’s reporting obligations to the SEC.
- DIt governs liability and profit sharing among syndicate members.✓ Correct answer
Explanation
Why D — It governs liability and profit sharing among syndicate members.
The AAU details the terms of liability and profit sharing among underwriters in a syndicate. The trap is confusing the AAU with issuer or regulatory responsibilities.
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