Price of common stock of a corporation in market is 60 per


Price of common stock of a corporation in market is $60 per share and purchase of each share gives the buyer as subscription right. If someone has 4 rights then an additional share of common stock can be purchased at a subscription price of $54 per share.

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A. What would be the approximate theoretical value of the right if the company is currently selling common stocks rights on?

 

B. What would be the approximate theoretical value of one share of a corporation if it goes Ex-rights?

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Financial Management: Price of common stock of a corporation in market is 60 per
Reference No:- TGS01390170

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