UPENN: LOOSE LEAF CORP.FIN W/CONNECT
UPENN: LOOSE LEAF CORP.FIN W/CONNECT
17th Edition
ISBN: 9781260361278
Author: Ross
Publisher: McGraw-Hill Publishing Co.
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Chapter 20, Problem 16QP
Summary Introduction

To explain: The equation of the value of a right.

Dilution:

The dilution is a process or action where the ownership percentage of a shareholder gets reduced due to the issue of new shares. As the number of outstanding shares gets increased, the par value of the company gets decreased.

Value of a Right:

The difference betweenthe offered value of the rights and the value of the ex-rights price per share is termed as value of a right.

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