PELLYKW6A5Problems2

PELLYKW6A5Problems2 - a b c d e $47,220,000.00 5.625 $89.09...

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a. $47,220,000.00 b. 5.625 c. $89.09 d. $0.91 e. A rights offering usually costs less, it protects the proportionate interests of existing shareholders and also protects against underpricing
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812903.23
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For $80: [5 (80) + 80] / 6 = 80 The alternating offering price would have no affect on the existing price per share. For $75: [5 (80) + 75] / 6 = 79.17 = 80 - 79.17 = 0.83 The alternating offering price causes a drop of 0.83 on the existing price per share.
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This note was uploaded on 02/12/2012 for the course MBA 551 taught by Professor Smith during the Spring '11 term at Indiana Wesleyan.

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PELLYKW6A5Problems2 - a b c d e $47,220,000.00 5.625 $89.09...

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