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Todd Winningham IV has $5,700 to invest. Todd owns shares of Gallagher Tennis Clubs Inc. Gallagher has issued a rights offering to its common shareholders. Six rights plus $64 cash will buy one new share. Gallaghers stock is selling for $82 ex-rights.

a-1. How many rights could Todd buy with his $5,700?

Number of rights

a-2. Alternatively, how many shares could he buy with the same $5,700 at $82 per share? (Round the final answer to the nearest whole number.)

Number of shares

b. If Todd invests his $5,700 in Gallagher rights and the price of Gallagher stock rises to $94 per share ex-rights, what would be his dollar profit on the rights? (First compute profits per right.) (Do not round intermediate calculations.)

Dollar profit $

c. If Todd invests his $5,700 in Gallagher shares and the price of a share rises to $90 per share exrights, what would be his total dollar profit? (Round intermediate calculations.)

Total dollar profit $

d. What would be the answer to part b if the price of a Gallagher share price falls to $56 per share ex-rights instead of rising to $90? (Negative answer should be indicated by a minus sign.)

Dollar profit / loss on the rights $

e. If Todd invests his $5,700 in Gallagher stock and the price of the stock falls to $56 per share ex-rights, what would his dollar profit be? (Negative answer should be indicated by a minus sign.)

Dollar profit / loss on the stock $

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