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

question 91

Multiple Choice

Use the following information to answer the question(s) below.
Wyatt Oil has assets with a market value of $600 million,$70 million of which are cash.It has debt of $250 million,and 20 million shares outstanding.Assume perfect capital markets.
-If Wyatt Oil distributes the $70 million as a share repurchase,then its stock price after the share repurchase will be closest to:

• A)$11.00.
• B)$12.50.
• C)$14.00.
• D)$17.50.

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Definitions:

Social Loafing

The phenomenon where individuals exert less effort to achieve a goal when they work in a group compared to when they work alone.

Social Influence

The effect that the words, actions, or mere presence of other people have on our attitudes, beliefs, or actions.

Conformity

The adjustment of one's behaviors, attitudes, or beliefs to match those of the group or to meet group standards.

Propinquity

The physical or psychological proximity between people, influencing their likelihood of forming relationships.