Magenta Corporation wants to raise $50 million in a seasoned equity offering, net of all fees. Magenta stock currently sells for $10 per share.

The underwriters will require a spread of $0.50 per share, and indicate that the issue must be underpriced by 5 percent. In addition to the underwriter’s fee, the firm will incur $1,000,000 in legal, accounting, and other costs. How many shares must Magenta sell?

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