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Walton Industries, Inc. (WII), has 10,000 shares of common stock outstanding, and the current price of the stock is $100 per share. The firm does not have any debt. The CEO discovs an opportunity in a new project that produces positive net cash flows with a present value of $210,000. The total initial costs for investing and developing this project are only $110,000. The CEO will raise the necessary capital for this investment by issuing new equity. All potential buyers of the firm' common stock will be fully aware of the project's value and cost, and are willing to pay "fair value" for the new share of WII common stock.

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