Use the Information for the Question(s)below

question 22

Multiple Choice

Use the information for the question(s) below.
Electronic Gaming Incorporated (EGI) is a firm with no debt and its 20 million shares are currently trading for $16 per share.Based on the prospects for EGI's new handheld video game,management feels the true value of the firm is $20 per share.Management believes that the share price will reflect this higher value after the video game is released next fall.EGI has already announced plans to raise $100 million from investors to build a new factory.
-Assume that EGI decides to wait until after the release of the new video game before they raise the $100 million through the issuance of new shares.The number of new shares that EGI will issue is closest to:

• A)1.6 million.
• B)5.0 million.
• C)10 million.
• D)6.25 million.

---

Definitions:

Informational Meeting

A gathering organized to share and exchange information rather than to take decisions or solve problems.

Publicis Communications

A global advertising and public relations company, part of the Publicis Groupe, specializing in marketing, communication, and digital transformation services.

Competitive Intelligence

The process of gathering, analyzing, and using information about competitors, market trends, and the business environment to make strategic decisions.

High-Profile Clients

Customers or clients with a significant public profile, influence, or importance.