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Raggio, Inc., has 100,000 shares of stock outstanding. Each share is worth $58, so the companys market value of equity is $2,700,000. Suppose the firm

Raggio, Inc., has 100,000 shares of stock outstanding. Each share is worth $58, so the companys market value of equity is $2,700,000. Suppose the firm issues 23,000 new shares at the following prices: $58, $55, and $50.

What will the effect be of each of these alternative offering prices on the existing price per share? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16. Leave no cells blank; if there is no effect select "No change" from the dropdown and enter "0".)

Price Ex Rights Effect Amount
a. $58 $ (Click to select)Price drops byPrice increases byNo change $ per share
b. $55 $ (Click to select)Price drops byNo changePrice increases by $ per share
c. $50 $ (Click to select)Price increases byNo changePrice drops by $ per share

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