The Calculation of the Theoretical Ex-Rights Price of a Share

question 67

Multiple Choice

The calculation of the theoretical ex-rights price of a share may be expressed as:

• A) aggregate market price per share immediately prior to exercise of rights plus dividends receivable on the shares divided by number of shares outstanding after the exercise of rights.
• B) aggregate market price per share immediately prior to exercise of rights plus proceeds from the exercise of rights divided by number of shares outstanding after the exercise of rights.
• C) aggregate market price per share immediately after the exercise of rights plus proceeds from the exercise of rights divided by number of shares outstanding before the exercise of rights.
• D) aggregate market price per share immediately after the exercise of rights plus proceeds from the exercise of rights divided by number of shares outstanding after the exercise of rights.

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Definitions:

Negligence

The failure to exercise the standard of care that a reasonably prudent person would have exercised in a similar situation, resulting in harm or damage.

Term

can refer to a fixed or limited period for which something, such as an agreement or tenure, lasts or is intended to last.

Misrepresented

Incorrectly or falsely represented information, which can lead to misunderstandings or legal issues within agreements or contracts.

Innocently

Without guilt, harm, or malice; in a manner free from wrongdoing or deception.