question archive At the beginning of the fiscal year Firm Z goes public and offers 100,000 shares of common stock to the general public for 10 € each
At the beginning of the fiscal year Firm Z goes public and offers 100,000 shares of common stock to the general public for 10 € each
Subject:EconomicsPrice: Bought3
At the beginning of the fiscal year Firm Z goes public and offers 100,000 shares of common stock to the general public for 10 € each. Household J buys these shares. Three months later Household J sells 50,000 of her shares to Household X for 20 € each. Net profit at the end of the fiscal year is 12,000,000 €. Firm Z distributes 11,000,000 € of the net profit as dividends on the last day of the fiscal year.
The total amount of equity financing that Firm Z has obtained is equal to:
a) 1,000,000 €
b) 2,000,000 €
c) 3,000,000 €
d) 4,000,000 €
e) 5,000,000 €
