Gce Model Questions Vol1 2018 Commerce Question 11
Practice objective / multiple choice question 11 from the 2018 Gce Model Questions Vol1 Commerce examination.
A company's shares are currently trading at \(\text{₦}150\) each. The company announces a rights issue where each shareholder can purchase one new share for every two shares they already hold at a subscription price equal to 80 % of the current market price. After the rights issue the theoretical ex‑rights price is expected to fall to this value, and then market sentiment is projected to lift the share price by 4 %. The company also pays an annual dividend equal to 5 % of the nominal value of \(\text{₦}100\) per share. Calculate the dividend yield (as a percentage) based on the share price after the rights issue and the anticipated 4 % increase.
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About This Question
This is Gce Model Questions Vol1 2018 Commerce Question 11. It is one of the objective questions from the 2018 Gce Model Questions Vol1 Commerce examination.
Difficulty level: Hard .
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