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# Corporate Finance: Value, Exercise Price and Exchange Rate

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PROBLEM 1:
Net Worth \$16,500
Long-term Debt \$7,800
Net Working Capital (Excluding Cash) \$1,900
Fixed Assets \$20,700
Current Liabilities \$2,750

Cash =
Net Working Capital (Including Cash) =
Current Assets =

PROBLEM 2:
# of shares outstanding 450,000
Current Stock Price \$90
# of new shares outstanding in the future (rights offering) 80,000
Price of New Stock (or rights) \$84

A. New Market Value of the Company =
B. # of Rights Needed =
C. Ex-Rights Price =
D. Value of the Right =

PROBLEM 3:
Spot exchange rate for the Canadian Dollar \$1.02
6 month forward rate \$1.03
U.S. Dollar \$1.00

PROBLEM 4:
British Pound Exchange Rate= 93
Japanese Yen Exchange Rate= 1

Cross Rate in terms of Yen per Pound =

#### Solution Preview

PROBLEM 1:
Net Worth \$16,500
Long-term Debt \$7,800
Net Working Capital (Excluding Cash) \$1,900
Fixed Assets \$20,700
Current Liabilities \$2,750