You own 5 percent or 4,000 shares of Tonka, Inc. These shares have a total market value of $92,000. By what percentage will the total value of your investment in Tonka change if the
Company sells an additional 10,000 shares of stock at $21 a share and you do not buy any?

Question

Quizplus · Accepted Answer

The initial total shares are 80,000 (since 4,000 shares represent 5%). After selling 10,000 more shares, the total becomes 90,000. The new value of your shares is $21 * 4,000 = $84,000. The percentage change is (($84,000 - $92,000) / $92,000) * 100 = -8.7%. However, the percentage change in the value per share is -0.96%.

You Own 5 Percent or 4,000 Shares of Tonka, Inc