A Firm Has Just Issued $250 Million of Equity, Which

question 111

Multiple Choice

A firm has just issued $250 million of equity, which caused its stock price to drop by 3%.Calculate the loss in value of the firm's equity given that its market value of equity was $1 billion before the new issue.(Use value in millions)

• A)$7.5 million
• B)$30.0 million
• C)$33.3 million
• D)$37.5 million

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Definitions:

Sample Biases

Distortions in a sample that arise from the method of collection, leading to results that are not representative of the population being studied.

Cohort Differences

Variations or changes that are observed between different demographic groups, often studied across different time periods.

Longitudinal Research

A research design that involves repeated observations of the same variables over short or long periods of time to track changes and developments.

Cross-Sectional

A research design that examines data from a population, or a representative subset, at one specific point in time.