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What is the price of each right

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Reference no: EM131837763

Please explain:

Company ABC is issuing new common shares in a rights offer in order to raise $10 million for a new project. The subscription price for each new share is $10. The firm currently has 2 million common shares outstanding, each priced at $25 in the market. What is the price of each right?

Select one:

a. $1

b. $2

c. $5

d. $10

e. $15

Reference no: EM131837763

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