What Is the Primary Reason for a Reduction in Share

question 86

Multiple Choice

What is the primary reason for a reduction in share value after a successful rights issue? The new shares:

• A) have higher underwriting expenses.
• B) are offered at attractive prices.
• C) reduce the firm's return on equity.
• D) do not include voting rights.

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Definitions:

Self-efficacy

A belief in one's capabilities to organize and execute the courses of action required to manage prospective situations.

Birth Order

The theory that a person's rank by age among siblings influences their personality and behavior.

Personality Theorist

A psychologist or scholar who studies and develops theories about the nature, development, and variations of personalities.

Behavioural Personality Theories

Theories suggesting that personality is a result of interaction between the individual and the environment.