Examlex

Solved

Firm a Is Planning on Merging with Firm B

question 40

Multiple Choice

Firm A is planning on merging with Firm B.Firm A currently has 2,300 shares of stock outstanding at a market price of $20 a share.Firm B has 750 shares outstanding at a price of $15 a share.The merger will create $200 of synergy.How many of its shares should Firm A offer in exchange for all of Firm B's shares if it wants its acquisition cost to be $12,000?


Definitions:

Millionaires

Millionaires are individuals whose net worth or wealth is equal to or exceeds one million units of currency.

Budget Line

A graphical representation showing the combination of goods a consumer can purchase and consume within their income level at specific prices.

Equilibrium

A state where market supply and demand balance each other, and as a result, prices become stable.

Consumer's Money Income

The total amount of income a consumer has available to spend and save after taxes have been deducted.

Related Questions