Hi everyone, I’m working on Q# 7 from chapter 23 and I am just wondering why they chose to calculate it the way they did. This is how they approached it: Unrealized losses = ($3M) Dividends = 10% x 20M = 2M However, the way that would make more sense to me would be: Unrealized losses = 10% of 3M = 300,000 dividends = 10% of 20m = 2m However, in several instances in the book, i realize that for unrealized losses/ gains, they assume that they own 100% of the shares of the company. Does anyone know why that is? If they only own 10% of the company, then they shouldn’t be hit with the entire burden of the $3m decrease in value.
never mind/ just realized that it said the value of this stake went down by $3m so they already discounted it to the 10% share. I guess it’s a good lesson to pay attention to every single word. 