Mayo Corporation Is Currently Trading at $30 Per Share

question 5

Multiple Choice

Mayo Corporation is currently trading at $30 per share.There are 10 million shares outstanding and the company has no debt.You believe that the value of the company would increase by 50% if the management were replaced.How much would you need to offer in total to acquire 50% of Mayo's shares?

• A)$300 million
• B)$150 million
• C)$100 million
• D)$10 million
• E)$50 million

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Definitions:

Lanugo

The fine, soft hair that covers the body and limbs of a human fetus, which is usually shed before birth and replaced by vellus hair.

Bone Marrow

A flexible tissue found in the interior cavities of bones that is a major site of blood cell production.

Corpora Cavernosa

Two parallel chambers of spongy tissue in the penis or clitoris that fill with blood during sexual arousal, leading to erection.

Corpus Spongiosum

A spongy tissue surrounding the urethra that becomes engorged with blood during an erection, preventing the urethra from pinching closed.