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

question 256

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. How many shares of firm A will be used to acquire firm B in an all-stock deal?

• A) 12,000
• B) 20,667
• C) 22,333
• D) 22,667
• E) 23,333

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Definitions:

Demand Constraint

A limitation in operational research and economics that restricts the quantity of goods or services that can be demanded.

Distribution Center

A specialized building or area where products are stored and distributed to retailers, wholesalers, or directly to consumers.

Demand Constraint

A limitation in mathematical models of supply and demand that restricts the quantity of goods or services that can be offered or demanded.

Minnesota

A state in the northern United States, known for its lakes and forests, and also as the Land of 10,000 Lakes.