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A company has 10,000 shares of stock that sell for $40 each...if the company issues 5,000 shares of the new stock at the following prices: $40, $20 and $10. What is the effect of each of the alternative offering prices on the existing price per share?

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The expert calculates the price of shares after issue of new shares.

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A company has 10,000 shares of stock that sell for $40 each...if the company issues 5,000 shares of the new stock at the following prices: $40, $20 and $10...what is the effect of each of the alternative offering prices on the existing price per share?

a) when shares are issued at $40
Number of existing shares= 10,000
Current share price= $40
Market value of shares before issue= $400,000 =10000x40
Number of new shares ...

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