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Kazeer [188]
3 years ago
14

You currently own 6 percent of the 2 million outstanding shares of Webster Mills. The company has just announced a rights offeri

ng with a subscription price of $50. One right will be issued for each share of outstanding stock. This offering will provide $18 million of new financing for the firm, ignoring all issue costs. Assume that all rights are exercised. What will be your new ownership position if you opted to sell your rights rather than exercise them personally?
A. 5.08
B. 4.58
C. 4.83
D. 5.33
Business
1 answer:
natta225 [31]3 years ago
8 0

Answer:

The new ownership position is A. 5.08

Explanation:

Current holding= 6%

current no. of shares= 2*6%=.12

new no. of shares issued =18/50=.36

total no. of shares become =2+.36=2.36 million

my holding in no. =.12 million

my holdinng in %=.12/2.36=.0508

or, 5.08%

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8 0
4 years ago
Read 2 more answers
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