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Jensen's Shipping Wants to Expand as Soon as It Can

question 2

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Jensen's Shipping wants to expand as soon as it can save $142 million.Towards that goal,the firm started saving three years ago and currently has $19.6 million saved.Starting today,the firm will add $12,000 a month to this savings account.The rate of return is 13.1 percent,compounded monthly.How long will it be from now before the company can expand?


Definitions:

Rights Offering

Rights offering is a financial opportunity provided to existing shareholders to purchase additional shares directly from the company at a predetermined price, usually lower than the market price, before the shares are offered to the public.

Subscription Price

The price at which existing shareholders are allowed to purchase new shares of a company, often during a rights offering.

Stock Price

The current price at which a share of a company is being bought or sold in the financial markets.

General Cash Offering

A public sale of securities in which the proceeds are used to fund general business activities and not earmarked for a specific project.

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