Business I / Joint-Stock Companies (S.A.)
Practice question · Estimate

An S.A. issues 10,000 shares of 10€ nominal value at a price of 14€ each. Set the slider to the total share premium collected, in thousands of €.

Estimate on a scale from 0k€ (0) to 100k€ (100).

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  1. Premium per share: 141014 - 10.
  2. 410,0004 \cdot 10{,}000.
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40 (answers within ±2 count)

Why

410,000=40,0004 \cdot 10{,}000 = 40{,}000€ of premium, the price of joining a company that is already worth more than its nominal capital. It protects old shareholders from giving value away.

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