A Owns 1000 Shares in XYZ Ltd Whose Current Share

question 32

Multiple Choice

A owns 1000 shares in XYZ Ltd whose current share price (cum rights) is $2 per share.XYZ Ltd makes a one for four rights issue with a subscription price of $1.40 per share.Calculate the value of R,of the right to one new share.

• A)8 cents.
• B)40 cents.
• C)48 cents.
• D)84 cents.

---

Definitions:

Local Share

Something such as a printer, folder, or disc that has been made available across a network.

Dollar Sign ($)

A symbol primarily used to indicate the currency value of dollars and pesos.

SSH

Secure Shell, a cryptographic network protocol used for secure connection over an unsecured network.

Telnet

A nonsecure application protocol that allows connection to a remote network device. Telnet uses port 23. Commonly replaced by the more secure SSH.