Northwest Territories Bikini Company Has Cash Flows from Operations of $150

question 37

Multiple Choice

Northwest Territories Bikini Company has cash flows from operations of $150 million and needs $125 million for investment purposes.Assume the firm has 15 million shares outstanding and its shares are presently trading at $15 per share.If the M&M conditions hold, how many new shares must be issued if the firm plans to pay a $3 per share dividend?

• A)1.33 million shares
• B)1.46 million shares
• C)1.67 million shares
• D)3.00 million shares

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Definitions:

Stimulants

Substances that increase the activity of the nervous system, resulting in increased alertness, attention, and energy.

Methamphetamine

A powerfully addictive drug that stimulates the central nervous system, with accelerated body functions and associated energy and mood changes; over time, appears to reduce baseline dopamine levels.

Euphoria

A feeling or state of intense excitement and happiness, often beyond what is considered normal.

Stimulants

Substances that increase alertness, attention, and energy by accelerating the activity of the central nervous system.