FARO Technologies, whose products include portable 3D measurement equipment, recently had 26 million shares outstanding trading at $45 a share. Suppose the company announces its intention to raise $290 million by selling new shares.How large a loss in dollar terms will existing FARO shareholders experience on the announcement date, based on studies that show losses are 30% of the size of the new issue?Note: Enter your answer in millions without a sign. What percentage of the value of FARO’s existing equity prior to the announcement is this expected loss?Note: Round your answer to 1 decimal place. At what price should FARO expect its existing shares to sell immediately after the announcement?Note: Do not round intermediate calculations. Round your answer to 2 decimal places.

I am going to solve the problem by using some simple algebra to get the required result of the given…

Answered: FARO Technologies, whose products…

Trigonometry (MindTap Course List)

10th Edition

ISBN:9781337278461

Author:Ron Larson

Publisher:Ron Larson

ChapterP: Prerequisites

SectionP.3: The Cartesian Plane And Graphs Of Equations

Problem 7ECP

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FARO Technologies, whose products include portable 3D measurement equipment, recently had 26 million shares outstanding trading at $45 a share. Suppose the company announces its intention to raise $290 million by selling new shares.

How large a loss in dollar terms will existing FARO shareholders experience on the announcement date, based on studies that show losses are 30% of the size of the new issue?
Note: Enter your answer in millions without a sign.
What percentage of the value of FARO’s existing equity prior to the announcement is this expected loss?
Note: Round your answer to 1 decimal place.
At what price should FARO expect its existing shares to sell immediately after the announcement?
Note: Do not round intermediate calculations. Round your answer to 2 decimal places.