Use the Information for the Question(s)below

question 72

Essay

Use the information for the question(s)below.
Rockwood Industries has 100 million shares outstanding,a current share price of $25,and no debt.Rockwood's management believes that the shares are underpriced,and that the true value is $30 per share.Rockwood plans to pay $250 million in cash to its shareholders by repurchasing shares.Management expects that very soon new information will come out that will cause investors to revise their opinion of the firm and agree with Rockwood's assessment of the firm's true value.
-Calculate Rockwood's stock price following the market becoming aware of the new information regarding Rockwood's true value,if (1)Rockwood completed the repurchase prior to the market becoming aware of the information and (2)Rockwood completed the repurchase following the market becoming aware of the new information.

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Definitions:

Enlisting Black

The action of recruiting or enrolling African-Americans into the military forces, notably significant during the Civil War and World War II in the United States.

Armed Rebellion

An uprising or revolt that involves the use of weapons, often aimed at overthrowing the ruling government or authority.

Mortality Rate

A measure of the number of deaths in a particular population, scaled to the size of that population, per unit time.

Fatigue Duty

Labor, often of a menial or exhausting nature, assigned to soldiers in addition to their regular duties.