ACFN584 - Advanced Corporate Finance Assignment II Questions 1. Briefly explain each of the following a. Zero-stage, first-sage or second-stage financing. b. Carried interest c. Rights issue d. Road show e. Best-efforts offer f. Qualified institutional buyer g. Blue-sky laws h. Greenshoe option 2. Why are the costs of debt issues less than those of equity issues? List the possible reasons. 3. Construct a simple example to show the following a. Existing shareholders are made worse off when a company makes a cash offer of new stocks below the market value. 4. In 2001 the Pandora Box company made a rights issue at $5 a share of one new share for every four shares held. Before the issue there were 10 million share outstanding and the price was $6. a. What was the total amount of new money raised? b. What was the value of the right to buy one new share