Question: FARO Technologies, whose products include portable 3D measurement equipment, recently had 19 million shares outstanding trading at $45 a share. Suppose the company announces its

FARO Technologies, whose products include portable 3D measurement equipment, recently had 19 million shares outstanding trading at $45 a share. Suppose the company announces its intention to raise $220 million by selling new shares.

b. How large a loss in dollar terms will existing FARO shareholders experience on the announcement date, based on studies that show losses are 30% of the size of the new issue?

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