( C ) is known as Mini - Max underwriting. ( A ) is best efforts. ( D ) is all or none underwriting. The correct answer is ( B ).

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Which of the following best describes a firm commitment underwriting agreement?

When an underwriter promises to sell as much of the new offering as possible without guarantees.

When an underwriter assumes all inventory risk and buys all securities of the new offering.

When an underwriter agrees that the offering won't be effective until a specified minimum number of securities are sold.

When an issuer requires to sell all of the new issue securities; and if all are not sold, the issue is canceled and funds are returned to investors.