Damron, Incorporated, has 230,000 shares of stock outstanding. Each share is worth $84, so the company's market value of equity is $19,320,000. Suppose the firm issues 54,000 new shares at the following prices: $84, $78, and $72. What will be the ex-rights price and the effect of each of these alternative offering prices on the existing price per share? (Leave no cells blank; if there is no effect select "No change" from the dropdown and enter "O". Round your answers to 2 decimal places, e.g., 32.16.)

Damron, Incorporated, has 230,000 shares of stock outstanding. Each share is worth $84, so the company's market value of equity is $19,320,000. Suppose the firm issues 54,000 new shares at the following prices: $84, $78, and $72. What will be the ex-rights price and the effect of each of these alternative offering prices on the existing price per share? (Leave no cells blank; if there is no effect select "No change" from the dropdown and enter "O". Round your answers to 2 decimal places, e.g., 32.16.)

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter15: Dividend Policy

Section: Chapter Questions

Problem 12P

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