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Find value of one right during the cum-rights period

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Reference no: EM133110426

A stock trades for $11 per share. It announces a rights offering with the following terms: 5 rights are required to purchase 1 share. The subscription price is $10.

Required:

A. What is the value of one right during the cum-rights period?

B. What is the value of one right during the ex-rights period?

C. Identify 3 actions that a holder of the rights may take

Reference no: EM133110426

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