Maggie owns 10% or 50,000 common shares of a small biotech company. Although she has enjoyed a lot of control, Maggie realizes that in order for the firm to acquire the funds to grow in a recessionary economy, it will need to issue more stock. Unless she and others exercise preemptive rights,

Question

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When company boards of directors vote to issue additional stock for public sale, the disadvantage is that there is dilution of ownership. Owners usually have one vote per share of ownership.

Maggie Owns 10% or 50,000 Common Shares of a Small