Calculating Costs of Issuing Stock DiPitro's Paint and Wallpaper, Inc., needs to raise $1 million to finance

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Calculating Costs of Issuing Stock DiPitro's Paint and Wallpaper, Inc., needs to raise $1 million to finance plant expansion. In discussions with its investment bank, DiPitro's learns that the bankers recommend a gross price of $25 per share and that 45,000 shares of stock be sold. If the net proceeds on the stock sale leaves DiPitro's with $1 million, calculate the underwriter's spread on the stock issue. (LG4)

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Finance Applications And Theory

ISBN: 9780073530673

2nd Edition

Authors: Marcia Cornett, Troy Adair, John Nofsinger

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