Raggio Inc. has 100,000 shares of stock outstanding. Each share is worth $80, so the companys market

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Raggio Inc. has 100,000 shares of stock outstanding. Each share is worth $80, so the company’s market value of equity is $8,000,000. Suppose the firm issues 20,000 new shares at the following prices: $80, $75, and $65. What will the effect be of each of these alternative offering prices on the existing price per share?

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Corporate Finance

ISBN: 978-0071339575

7th Canadian Edition

Authors: Stephen Ross, Randolph Westerfield, Jeffrey Jaffe, Gordon Ro

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