*(14-4) A firm has 20 million shares outstanding with a market price of $30 per
ID: 2646160 • Letter: #
Question
*(14-4) A firm has 20 million shares outstanding with a market price of $30 per share. The firm has $40 million in extra cash (short-term investments) that it plans to use in a stock repurchase; the firm has no other financial investments or any debt. What is the firm's value of operations after the repurchase? Enter your answer in millions. For example, an answer of $1.2 million should be entered as 1.2, not 1,200,000. Round your answer to two decimal places.
$_______ million
How many shares will remain after the repurchase? Round your answer to the nearest whole number.
Explanation / Answer
SOLUTION:
No. of shares = 20,000,000
Price per share = $30/share
Additional Cash = $40,000,000
Vop = ( n0 * P )
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.