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

question 47

Multiple Choice

Use the following information to answer the question(s) below.
Rearden Metal has earnings per share of $2. It has 10 million shares outstanding and is trading at $20 per share. Rearden Metal is thinking of buying Associated Steel, which has earnings per share of $1.25, 4 million shares outstanding, and a price per share of $15. Rearden Metal will pay for Associated Steel by issuing new shares. There are no expected synergies from the transaction.
-If Rearden pays no premium to buy Associated Steel, then Rearden's earnings per share after the merger will be closest to:

• A) $1.85
• B) $1.90
• C) $2.00
• D) $2.25

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Definitions:

Neurogenesis

The process of generating new neurons in the brain, which occurs in certain brain regions throughout life.

Dopamine

A neurotransmitter involved in controlling movement and posture, moderating mood, and plays a central role in the reward system of the brain.

Blood-Brain Barrier

A selective barrier that prevents certain substances in the bloodstream from entering the brain, protecting it from toxins and infections.

Serotonin

A neurotransmitter that plays a key role in mood regulation, digestion, sleep, and other bodily functions.