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4-You founded your firm with a contribution of $350,000, receiving 2,500,000 shares of stock. Since then, you sold 7,000,000 stocks to Angel Investors. Now you

4-You founded your firm with a contribution of $350,000, receiving 2,500,000 shares of stock. Since then, you sold 7,000,000 stocks to Angel Investors. Now you are considering raising more capital from a Venture Capitalist. They will invest $5,000,000 and would receive 5,000,000 newly issued shares. If this is the VC's first investment in the company, what is the value of your shares? Express the terms of your answer completely and in strictly numerical terms. For example: If your answer is one million dollars, write: 1000000.

5-Company B, is a private company that designs, manufactures and distributes certain consumer products. In this fiscal year, Company B had revenues of $70 Millions of USDs and earnings of $25 of Millions of USDs. Company B has filed a registration statement with the SEC for its IPO. If the industry average Price/Earnings ratio and Price/Revenues ratio for the recent fiscal year were 12 and 0.8 respectively. Estimate the IPO price for Company B using the Price/Earnings ratio and assuming that they will issue 15 Million shares.

6-Company B, is a private company that designs, manufactures and distributes certain consumer products. In this fiscal year, Company B had revenues of $70 Millions of USDs and earnings of $25 of Millions of USDs. Company B has filed a registration statement with the SEC for its IPO. If the industry average Price/Earnings ratio and Price/Revenues ratio for the recent fiscal year were 12 and 0.8 respectively. Estimate the IPO price for Company B using the Price/Revenues ratio and assuming that they will issue 15 Million shares.

7-Consider the situation faced by the CFO of a company with a market capitalization of $300 Millions of USD, e.g. the firm has 50 million shares outstanding, so the shares are trading at $6 per share. The CFO needs to raise $500 Millions of USDs and announces a rights issue. Each existing shareholder is sent 5 right for every share he or she owns. The CFO has not decided how many rights will be required to purchase a share of new stock. At the current price per share, what is the maximum amount of rights the CFO can require stockholders for purchasing a share of new stock and so be able to raise the $500 Millions of USDs?

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