You Decide to Raise $2 Million in Additional Funding Via

question 121

Multiple Choice

You decide to raise $2 million in additional funding via a rights offering. Every shareholder will receive one right for every share of stock they own. The offering consists of a total of 250,000 new shares. The current market price of your stock is $10. Currently, there are 1 million shares outstanding. What is the value of one right?

• A) $.25
• B) $.40
• C) $.75
• D) $1.20
• E) $1.50

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Definitions:

Vehicle Miles-Per-Gallon

A measure of how many miles a vehicle can travel on a single gallon of fuel, used as an indicator of fuel efficiency.

Population Size

The total number of individuals or items in the group being studied.

Sample Size

The number of observations or subjects used in a study or represented in a statistical sample.

Smaller

A comparative term indicating lesser in size, amount, or degree relative to something else.