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:

Cultural Traits

The distinctive characteristics, habits, customs, and norms that define a particular society or group.

Nonverbal Messages

Communication without words, including gestures, facial expressions, body language, and other forms of unspoken interaction.

Gender Interaction

The ways in which individuals behave and communicate with others based on socially constructed roles, expectations, and identities related to gender.

Ambivalent Sexism

A concept that divides sexism into two components: hostile sexism, which is overtly negative, and benevolent sexism, which is more subtle and rooted in protective paternalism.