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Suppose you (owner of the firm) have invested only $65,000 yourself. You raise the remaining $100,000 by issuing 125,000 shares and selling 100,000 to your
Suppose you (owner of the firm) have invested only $65,000 yourself. You raise the remaining $100,000 by issuing 125,000 shares and selling 100,000 to your brother at $1 a piece. You keep the remaining 25,000 shares. How much more is your share worth when you sell the company? What about your brothers?
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