Firm B Is Being Acquired by Firm a for $162,000

question 62

Multiple Choice

Firm B is being acquired by Firm A for $162,000 worth of Firm A stock.The incremental value of the acquisition is $4,600.Firm A has 8,500 shares of stock outstanding at a price of $36 a share.Firm B has 5,900 shares of stock outstanding at a price of $27 a share.What is the value per share of Firm A after the acquisition?

• A)$35.28
• B)$35.71
• C)$36.00
• D)$36.15
• E)$37.04

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Definitions:

Face Validity

Superficial observation that a test appears to cover the correct content or domain. This is not an actual form of validity since the appearance of test items may or may not accurately reflect the domain.

Pilot Study

A small-scale preliminary study conducted to evaluate feasibility, time, cost, risk, and adverse events, used to improve the design of a future full-scale research project.

Cross-Cultural Fairness

In assessment or testing, the principle of ensuring that tools and practices are equitable and do not favor one cultural group over others.

Item Response Theory

A theory and method in psychometrics that models the relationship between individuals' abilities or latent traits and their item responses, considering the properties of the items themselves.