An all-equity-financed firm is worth $800 million and raises another $200 million with new equity, paying $80 million in issuing fees. Calculate the percentage dilution, assuming that all
The dilution is due to the dilution of ownership interest of the existing shareholders. Round
Your answer to the nearest tenth of a percent.
A) 25.0%
B) 21.7%
C) 15.0%
D) 39.8%
Correct Answer:
Verified
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A)an increase in equity
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