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(Solved): Use the following information to answer the next 2 questions. Jumanji Corp. has decided to do a righ ...



Use the following information to answer the next 2 questions. Jumanji Corp. has decided to do a rights offering. It will issue 1 right for each share. The company currently has

20,000,000

shares outstanding, therefore

20,000,000

rights will be issued. The stock price today is

$45

per share. The company wishes to raise

$300,000,000

. It has set the subscription price at

$28

per share. Question 21: What will be the ex-rights price? a)

$39.07

b)

$36.45

c)

$34.33

d)

$35.19

e)

$37.56

Question 22: What will be the value of one right? a)

$5.56

b)

$11.34

c)

$5.93

d)

$3.43

e)

$4.41

Question 23: ABC Corp. issues 5.074 million shares at a price of

$12.06

per share. If the underwriter charges

5%

of the gross proceeds as a fee, how much money was raised in the sale? a)

$34.88

million b)

$58.13

million c)

$23.25

million d)

$37.5

million e)

$25

million

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