Question
Q1. XYZ Company owns 130 million shares and is currently trading at SAR 40 per share. To provide financing for expansion, XYZ decided to give
Q1. XYZ Company owns 130 million shares and is currently trading at SAR 40 per share. To provide financing for expansion, XYZ decided to give investors exercises right to buy one additional share for every 2 shares owned in a 1:2. How much should each share be worth after the rights issue if they previously sold for SAR 44 each?
Q2. ABC company has 11% expected return on assets and pays 7% on its debt. The company debt represents 40% of total asset. What is the expected return on equity for ABC company?
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Investment Analysis and Portfolio Management
Authors: Frank K. Reilly, Keith C. Brown
10th Edition
538482109, 1133711774, 538482389, 9780538482103, 9781133711773, 978-0538482387
