Questions 1. What factors should be considered in making the financing decision faced by CBI? Discuss each briefly. To raise the needed $28 million, how many shares of stock must be sold under the rights offering proposal, assuming all shares are subscribed? Compute the number of rights required to buy a share of stock. Compute the value of a right when the stock is selling at $60 per share right-on. Compute the value of the stock when it goes ex-rights. Is it likely they will all be exercised? 7. Under alternative 2, how many new shares of common stock must be issued to raise the needed $28 million? 8. What is the initial conversion ratio of the convertibles proposed in alternative 4? 9. What is the initial conversion value of each debenture? What is the meaning of this value? 10. How many shares must be issued if all debentures are converted at the initial conversion price? 11. What is the purpose of the stepped-up conversion prices