Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Please show ALL calculations Question 5.(15 pointsMarcus Company, is a successful start up business, but needs additional funding of$500,000 to fund continued growth.Currently the company

Please show ALL calculations

Question 5.(15 pointsMarcus Company, is a successful start up business, but needs additional funding of$500,000 to fund continued growth.Currently the company is worth $1,500,000.An angel investor is willing to invest the full $500,000.The owner of the company currently owns all 200,000 shares in her business

a.Calculate the fair price per share

b.How many additional shares must be sold to the angel investor?

c.What proportion of the company will the angel investor own?

d.What are 3 reasons that explain why the owner of the company wants to raise new equity capital?

e.What are 3 reasons that explain why the owner might consider raising new capital through debt rather than equity?

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Entrepreneurship

Authors: Andrew Zacharakis, William D Bygrave

5th Edition

1119563097, 9781119563099

More Books

Students also viewed these Finance questions

Question

Tell me about yourself.

Answered: 1 week ago

Question

Exercise 5-12 Multiproduct Break-Even Analysis [LO5-9]

Answered: 1 week ago

Question

=+0.1 oz with 95% confidence? Assume that s is known to be 1 oz.

Answered: 1 week ago