Use the Following Information to Answer the Question(s)below

question 82

Multiple Choice

Use the following information to answer the question(s) below.
Wyatt Oil has assets with a market value of $600 million,$70 million of which are cash.It has debt of $250 million,and 20 million shares outstanding.Assume perfect capital markets.
-If Wyatt Oil distributes the $70 million as a share repurchase,then its debt-to-equity ratio after the share repurchase will be closest to:

• A)0.9.
• B)1.0.
• C)1.1.
• D)1.4.

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Definitions:

Melatonin

A hormone produced by the pineal gland that regulates sleep-wake cycles.

Cortisol

A steroid hormone released by the adrenal glands in response to stress or low blood-glucose concentration; plays a significant role in the body's response to stress.

Erythropoietin

A hormone produced by the kidneys that stimulates the production of red blood cells in the bone marrow.

Kidney

A pair of organs located in the abdominal cavity responsible for filtering waste products from the blood and excreting them as urine.