You Are Considering a New Project with a Net Present

question 254

Multiple Choice

You are considering a new project with a net present value of $25,000 and an initial cash outlay for fixed assets of $120,000. You are planning on funding this project by selling 2,500 new shares of stock. Currently, your firm has 45,000 shares of stock outstanding and a book value per share of $30. What will the new book value per share be if you accept this project?

• A) $28.42
• B) $28.95
• C) $30.95
• D) $31.47
• E) $33.22

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Definitions:

Rural Operations

Activities and strategic measures undertaken by businesses and organizations to implement and manage processes in countryside or agricultural settings.

Financing

The process of providing funds for business activities, making purchases, or investing.

Small Businesses

Enterprises characterized by a small number of employees, limited revenue, and relatively smaller scale of operations.