Question
Consider the situation of a jet-loving CEO of $50 million all-equity company, assuming that the jet has a negative NPV of $1.5 million, but that
Consider the situation of a jet-loving CEO of $50 million all-equity company, assuming that the jet has a negative NPV of $1.5 million, but that the CEO personally values the jet at $1 million.
Suppose that the CEO, who initially owns 100% of the equity, decides to sell 40% of her shares to the public. How much cash can she raise by selling 40% of her equity?
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Fundamentals of Managerial Economics
Authors: Mark Hirschey
9th edition
324584830, 978-0324588781, 032458878X, 978-0324584837
