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A firm whose stock has a current market price of Rs. 120 per share proposes a rights issue in the ratio of 6 rights shares
A firm whose stock has a current market price of Rs. 120 per share proposes a rights issue in the ratio of 6 rights shares for every 20 shares held by an existing investor, at an issue price of Rs.108 per share. An existing investor holding 100 shares of the firm exercises her right for only half the shares she is eligible for. She neither exercises her remaining rights nor trades the remaining rights entitlements (RE). How much does she stand to lose in Rupees?
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