What is the value of the stock ex rights

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Knight Inventory Systems, Inc., has announced a rights offer. The company has announced that it will take three rights to buy a new share in the offering at a subscription price of $61. At the close of business the day before the ex-rights day, the company’s stock sells for $85 per share. The next morning, you notice that the stock sells for $70 per share and the rights sell for $2 each.

What is the value of the stock ex rights?

What is the value of the rights?

What is the amount of instant profit you can make on ex rights day per share?

Instant profit=

Reference no: EM131016122

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