Firm B Is Willing to Be Acquired by Firm a at a Price

question 94

Multiple Choice

Firm B is willing to be acquired by firm A at a price of $34 a share in either cash or stock. The incremental value of the proposed acquisition is estimated at $80,000. What is the price per share of firm AB if the merger is an all-stock deal?

• A) $18.00
• B) $18.70
• C) $18.80
• D) $19.32
• E) $21.00

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Definitions:

Consumption's Need

This term could relate to the requirement or demand for goods and services by individuals or households in an economy, but without more context, it's broadly related to consumer behavior.

Available Savings

The amount of money that remains after all spending, taxes, and financial obligations have been accounted for.

Savings Dollars

Funds that are saved and set aside for future use instead of being spent.

Flow

In the context of finance, it often refers to the movement of funds in and out of a business, project, or investment, including cash flow.