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

question 271

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 NPV of the merger of firm B by firm A in an all-stock deal?

• A) $28,127
• B) $31,000
• C) $37,639
• D) $42,877
• E) $44,000

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Definitions:

Bobo Doll

A doll used in social learning experiments to demonstrate the impact of observed behavior on children's aggression.

Bandura

A psychologist known for his work on social learning theory, emphasizing the importance of observational learning, self-efficacy, and modeling.

Modeled Aggression

Aggressive behavior learned through observing others and replicating their actions.

Bandura

Refers to Albert Bandura, a psychologist known for his work on social learning theory, emphasizing the role of observational learning, imitation, and modeling.