5. value: 10.00 points The Elkmont Corporation needs to raise $49 million to fin
ID: 2623432 • Letter: 5
Question
5.
value:
10.00 points
The Elkmont Corporation needs to raise $49 million to finance its expansion into new markets. The company will sell new shares of equity via a general cash offering to raise the needed funds. The offer price is $26 per share and the company
The Elkmont Corporation needs to raise $49 million to finance its expansion into new markets. The company will sell new shares of equity via a general cash offering to raise the needed funds. The offer price is $26 per share and the company
Explanation / Answer
number of shares*offer price*(1-spread) = finance needed
number of shares = 49000000/(26*(1-7.5%))=2,037,422
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