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A company is raising new capital by giving its existing shareholders the opportunity to subscribe for new shares. For each 10 shares held, an existing
A company is raising new capital by giving its existing shareholders the opportunity to subscribe for new shares. For each 10 shares held, an existing shareholder can buy 1 new share at $20. This $20 price is 30 percent below the current price per share in the market. This is an example of a(n):
a. rights offering.
b. private placement.
c. initial public offering.
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