Firm a Is Planning on Merging with Firm B

question 3

Multiple Choice

Firm A is planning on merging with Firm B.Firm A will pay Firm B's stockholders the current value of their stock in shares of Firm A because no synergy will be created.Firm A currently has 3,000 shares of stock outstanding at a market price of $15 a share.Firm B has 1,000 shares outstanding at a price of $10 a share.What is the value of the merged firm?

• A)$25,000
• B)$45,000
• C)$55,000
• D)$60,000
• E)$50,000

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Definitions:

Formal Communication

Formal communication is the exchange of information through officially designated channels and protocols within an organization, adhering to established guidelines and structures.

Personal Trust

The confidence or belief in an individual's reliability, integrity, and abilities, often established through interpersonal interactions.

Team Members

Individuals who work collaboratively as part of a group to achieve common goals.

Project Story

A narrative or account of a project's development, challenges, and successes, often used for documentation or stakeholder communication.