The market value of the research firm Fax Facts is $600 million. The firm issues an additional

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The market value of the research firm Fax Facts is $600 million. The firm issues an additional $100 million of stock, but as a result the stock price falls by 2%. What is the cost of the price drop to existing shareholders as a fraction of the funds raised?

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Fundamentals of Corporate Finance

ISBN: 978-1259722615

9th edition

Authors: Richard Brealey, Stewart Myers, Alan Marcus

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