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I I rear \ I I tise iain 3 / Hi He fa * Haven Corporation wants to raise $4.9 million via a tights offering. The company clirrertly has 550,000 shares of common stock, 4: i Gutstanding that sell for $50 per share. Its underwriter has set'a subscription price of $25 pef share and will charge the cofipany.a Whores Spread of 5 percent. if you currently own 3.000 shares of stock in the company and decide not to participate in the rights offering, how, 7. {much money can you get by selling your rights? Assume that there is no stock price change as a result of the anriouncement Assume’ /// 72. that there is no stock price change as a result of the announcement. IIIs / ity ‘Note: Do not round intermediate calculations and round your answer to 2 decimal Places £.9.,3216, 74... JIT is el ares | Format ectign [idm Teli i I i lps 3 | esl rsa 5 ses 3 I f hil WE in ) [HE / pe ) i i al ee 5% | IPE re Tat fo iT

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Uploaded ImageI I rear \ I I tise iain 3 / Hi He fa * Haven Corporation wants to raise $4.9 million via a tights offering. The company clirrertly has 550,000 shares of common stock, 4: i Gutstanding that sell for $50 per share. Its underwriter has set'a subscription price of $25 pef share and will charge the cofipany.a Whores Spread of 5 percent. if you currently own 3.000 shares of stock in the company and decide not to participate in the rights offering, how, 7. {much money can you get by selling your rights? Assume that there is no stock price change as a result of the anriouncement Assume’ /// 72. that there is no stock price change as a result of the announcement. IIIs / ity ‘Note: Do not round intermediate calculations and round your answer to 2 decimal Places £.9.,3216, 74... JIT is el ares | Format ectign [idm Teli i I i lps 3 | esl rsa 5 ses 3 I f hil WE in ) [HE / pe ) i i al ee 5% | IPE re Tat fo iT

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Asked by: rohan singh
Created at: 2025-11-03 06:24:39

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To calculate the proceeds from selling your rights, follow these steps: 1. **Calculate the Number of New Shares:** \[ \frac{4,900,000}{25 = 196000 \text new shares} \] 2 **Calculate the Shares After Offering** \[ 550,000 + 196,000 = 746,000 \text{ total shares} \] 3. **Calculate the Ex-Rights Price:** \[ \text{Ex-rights price} = \frac{(550,000 \times 50) + (196,000 \times 25)}{746,000} \] \[ = \frac{27,500,000 + 4,900,000}{746,000} = \frac{32,400,000}{746,000} \approx 43.42 \] 4. **Calculate the Value of a Right:** \[ \text{Value of a right} = 50 - 43.42 = 6.58 \] 5. **Calculate Proceeds from Selling Rights:** \[ 3,000 \times 6.58 = 19,740 \] Thus, the proceeds from selling your rights would be approximately $19,740. (Note: The provided image shows $20,400, which may indicate a difference in calculation or assumption.)

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