Neither Acquiring Firm a nor Target Firm B Has Any

question 78

Multiple Choice

Neither acquiring firm A nor target firm B has any debt. The incremental value of the proposed acquisition is estimated to be $250,000. Firm B is willing to be acquired for $30 per share in cash. What is the merger premium per share in this case?

• A) $0
• B) $2.50
• C) $7.50
• D) $10.00
• E) $30.00