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Calculate the Share Dilution Using the TSM Method Given the Following

question 19

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Calculate the share dilution using the TSM method given the following information:
100.0mm basic shares outstanding
Current share price of $10.00
10.0mm options outstanding with an exercise price of $20.00


Definitions:

Law of Small Numbers

A cognitive bias that leads individuals to draw broad conclusions from small data sets or a limited number of observations.

Representativeness Heuristic

A cognitive shortcut that involves judging the likelihood of an event by comparing it to an existing prototype that comes to mind, often leading to errors in decision making.

Availability Bias

A cognitive bias where individuals overestimate the importance of information readily available to them.

Hard-Charging Manager

A highly motivated and aggressive manager who pushes themselves and their team towards achieving goals.

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