Use the Information for the Question(s) Below

question 64

Multiple Choice

Use the information for the question(s) below.
Luther is a successful logistical services firm that currently has $5 billion in cash. Luther has decided to use this cash to repurchase shares from its investors and has already announced the stock repurchase plan. Currently Luther is an all-equity firm with 1.25 billion shares outstanding. Luther's shares are currently trading at $20 per share.
-Assume that in addition to 1.25 billion common shares outstanding, Luther has stock options given to employees valued at $2 billion. After the repurchase how many shares will Luther have outstanding?

• A) 1.15 billion
• B) 1.2 billion
• C) 0.75 billion
• D) 1.1 billion

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Definitions:

Cane

A support device used to assist walking, typically designed to bear weight and aid balance.

Walker

A mobility aid used to support individuals who need assistance walking due to injury, disability, or age.

Degree Angle

A measurement of the turn between two lines intersecting at a point, expressed in degrees.

Wheelchair

A chair fitted with wheels by which a person can propel oneself.