5) IPO Pricing. The following material represents the cover page and summaryof the prospectus for the initial public offering of the Pest InvestigationControl Corporation (PICC), which is going public tomorrow with firmcommitment initial public offerings managed by the investment-banking firmof Erlanger and Ritter. Answer the following questions: a. Assume that you know nothing about PICC other than the informationcontained in the prospectus. Based on your knowledge of finance,what is your prediction of price of PICC tomorrow? Provide a shortexplanation of what you think this occur. b. Assume that you have several thousand dollars to invest. When youget home from class tonight, you find that your stockbroker, whom youhave not talked to for weeks, has called. She has left a message thatPICC is going public tomorrow and that she can get you severalhundred shares at the offering price if you call her back first thing inthe morning. Discuss the merits of this opportunity.