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The Heath Company has 135,000 shares of stock that each sell for $80. Suppose the company issues 7,500 shares of new stock at

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Answer #1

a.

New Stock Price = (135,000(80) + 7,500(80))/142,500

New Stock Price = $80

b.

New Stock Price = (135,000(80) + 7,500(65))/142,500

New Stock Price = $79.21

c.

New Stock Price = (135,000(80) + 7,500(60))/142,500

New Stock Price = $78.95

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