AB Industries Is an All-Equity Firm That Has $10 Per

question 9

Multiple Choice

AB Industries is an all-equity firm that has $10 per share in cash and a book value per share of $12. At which one of the following market prices would you know with absolute certainty that the stock was mispriced?

• A) $9
• B) $10
• C) $11
• D) $12
• E) $13