Calculate the ex-right stock price, Finance Basics

DIY Inc. plans to raise $200,000 with a right offering. The current stock price is $100 and there are 80,000 shares outstanding.

 a. If DIY sets the subscription price to be $80 and one right will be issued for each outstanding share, calculate the ex-right stock price and the value of a right.

 b. Repeat part a if the subscription price is $10.

 c. If DIY wants the ex-right stock price to be $50, what must be the subscription price? 

 

 

Posted Date: 2/28/2013 12:01:32 AM | Location : United States







Related Discussions:- Calculate the ex-right stock price, Assignment Help, Ask Question on Calculate the ex-right stock price, Get Answer, Expert's Help, Calculate the ex-right stock price Discussions

Write discussion on Calculate the ex-right stock price
Your posts are moderated
Related Questions
Who is Floor Broker Floor brokers aren't many in number. They execute orders for fellow  members  and  receive  a  share  brokerage  commission  charged  by  a commission broke

What are the main functions of the financial systems? The main functions of financial systems in short are as follows: a. Give the mechanisms by that funds can be transferre

Suppose an entrepreneur owns a firm that has a production technology that generates the following revenue: R(e) = e 2 +100e where revenue depends on his effort level e. The monetar

Actions of Shareholders in Agency Conflict a) Disposal of assets required like collateral for the debt in this. In this case the bondholder is exposed to more risk becaus

Define Meaning of Investment Meaning of Investment: Investment involves making of a sacrifice in the present with hope of deriving future advantages. Investment has many

High Potential Venture An organization begins with the intent of growing quickly to annual sales of at least $30 to 50 million in 5 years. It also has the potential to have a f

Example of Miller-Orr Model XYZ's management has put the minimum cash balance to be equivalent to Sh.10, 000. The standard deviation of daily cash flow is of Sh.2, 500 and the

Explain the term - Underwriting Underwriting is an agreement whereby underwriter promises to subscribe to a specified number of debentures or shares or a specified amount of

For this assignment you are acting as a financial analyst for Apple Inc. Apple Inc. Is one of the most innovative companies worldwide. For example, in November 2012 Apple sold 3 mi

Leverage and Coverage Ratios   (The data for interest coverage are in I-Metrix's liquidity ratios section.  The others listed in this table are in the leverage ratios section