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

question 34

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 value of one share of stock in AB if the merger is a cash deal?

• A) $18.00
• B) $19.10
• C) $20.00
• D) $21.30
• E) $25.47

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