How many shares will the company need to issue

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Young Corporation stock currently sells for $34 per share. There are one million shares currently outstanding. The company announces plans to raise $5 million by offering shares to the public at a price of $34 per share

Problem a. If the underwriting spread is 9%, how many shares will the company need to issue in order to be left with net proceeds of $5 million? Round your answer to the nearest whole .) Number of shares___

Problem b. If other administrative costs are $60,000, what is the dollar value of the total direct costs of the issue? (Round your answer to the nearest dollar.) Dollar value of total direct costs__

Problem c. If the share price falls by 5% at the announcement of the plans to proceed with a seasoned offering . what is the dollar cost of the announcement effect? (Round your answer to the nearest dollar .) Dollar value of total direct costs

Reference no: EM132794488

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