Question

John owns stock in GHWB Inc. GHWB Inc. is planning to issue 200,000 shares of common stock to finance a new factory in China. What type of risk does John face and how can he avoid it?


Select the best answer from the choices provided.
John faces inflation risk; he can sell his stock before the new shares are issued.
John faces inflation risk; he can sell his stock after the new shares are issued.
John faces share dilution risk; he can sell his stock before the new shares are issued.
John faces share dilution risk; he can sell his stock after the new shares are issued.

Answer 1

C is correct

Answer 2

i was about to tagg you @sylbot

Answer 3

if you sell your stock before dilution, you can be equal amounts of equity (percentage wise) later.

Answer 4

John faces share dilution risk; he can sell his stock before the new shares are issued.

Answer 5

thats the answer

Answer 6

yup thats what I got.

Answer 7

correct :)