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Question 5A (3 marks) The Sun-Moon Ltd currently has 75 milijon shares outstanding. The shares sell for $10 per share. To raise $100 million for

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Question 5A (3 marks) The Sun-Moon Ltd currently has 75 milijon shares outstanding. The shares sell for $10 per share. To raise $100 million for a new plant, the firm is considering a rights offering at $4 per share. How many new shares are to be sold? How many shares are to be held in order to get one new share? Compute the value of a right and also the value of an ex-rights share. Question 5B (3 marks) Discuss TWO drawbacks of rights issue for a firm. (maximum 100 words)

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