Damron, Incorporated, has 235,000 shares of stock outstanding. Each share is worth $85, so the companys market value of equity is $19,975,000. Suppose the firm issues 56,000 new shares at the following prices: $85, $79, and $73. What will be the ex-rights price and the effect of each of these alternative offering prices on the existing price per share?

Price Ex-Rights Effect a. $85 b. $79 c. $73 Amount per share per share per share