Answer:
value of right = $1.95
Explanation:
given data
new shares = $19 plus 3
current market price = $26.80
to find out
value of one right
solution
we get here value of rights that is express as
value of rights = [tex]\frac{stock \ price - right\ subcription\ price}{no\ of\ right + 1}[/tex] .............1
value of rights = [tex]\frac{26.80-19}{3+ 1}[/tex]
value of rights = [tex]\frac{7.8}{4}[/tex]
value of right = $1.95
