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Hello Chris,
When calculation the theoretical ex rights price we take the total share price divided by the total no. of shares
But I see that in practice question’s solution it is calculated the other way round. (Referring to question 1)
Can you please clear this doubt ?
Thank You!
Hi,
Yes the TERP is the value of the shares in issue after the rights issue, divided by the number of shares in issue.
I’m not too sure which practice question you are referring to exactly, sorry, so can’t give you any further information. Could you please be a bit more specific and then I can help further.
Thanks
My apologies!
It’s correct in the solution. Please ignore this silly doubt 😀
No worries, just don’t make the mistake in the exam!!!!!
Thanks