Bubba holds 200 shares of common stock in a utility company and receives rights to subscribe to an additional 100 shares at $20. The utility company is raising $40 million of new capital. How many rights does Bubba receive?
A)20
B)50
C)100
D)200

Question

Quizplus · Accepted Answer

200. In an issue of rights, there is always one right per share. Bubba owns 200 shares and thus receives the same number of rights.

Bubba Holds 200 Shares of Common Stock in a Utility