Beta Corporation and Gamma Ltd.are Merging

question 7

Multiple Choice

Beta Corporation and Gamma Ltd.are merging.

The basis for the merger will be a share-for-share exchange based on market prices,and the share value of the combined firm is expected to remain unchanged.What would the earnings per share and price-earnings ratio be after the merger?

• A) 1.73 and 17.34
• B) 1.35 and 22.22
• C) 1.6 and 18.75
• D) 2 and 15

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Definitions:

Real Estate Commission

The fee, typically a percentage of the sale price, paid to a real estate agent or broker for their services in selling a property.

Trade Discount

A reduction in the list price granted by a seller to a buyer, often based on the volume of goods purchased or to maintain a long-term sales relationship.

Trade Discount

A reduction from the list price granted by a seller to a buyer based on the volume or quantity purchased or to stimulate sales.

Discount Series

A sequence of discounts applied one after the other, often used to determine the final price after multiple discounts are applied.