(Answered) Question1 considering the follow premerger information

Economics

Question:

1. Considering the follow premerger information about a bidding firm (Firm B) and a target firm (Firm T). Assume that both firms have no debt outstanding.

Firm B Firm T

Shares outstanding 5,400 1,300

Price per share $ 53 $ 23

A firm B has estimated that the value of the synergistic benefits from acquiring Firm T is $7,900. Firm T can be acquired for $25 per share in cash or by exchange of stock wherein B offers one of its shares for every two of T's shares.

Throughout such exchange ratio of B shares to T shares would the shareholders in T be indifferent between the two offers? (Not round intermediate calculations and round your answer to 4 decimal places)

Exchange ratio _____ to 1

View complete question

Business Economics, Economics

Category:- Business Economics
Reference No.:- M93106223
Price:- $10

Verified Expert

Priced at $20 Now at $10, Verified Solution

Have any Question?Write your Review or question?

Related Questions in Business Economics

In families with four children youre interested in the

In families with four children, you're interested in the probabilities for the different possible numbers of girls in a family. Using theoretical probability (assume girls and boys are equally likely), compile a five-col ...

How does off-task behavior change the dynamics of the

How does off-task behavior change the dynamics of the learning environment? Provide an example and a strategy to handle the behavior.

Suppose there is no inflation and an insurance company

Suppose there is no inflation and an insurance company offers a contract that would pay $500,000 with certainty 50 years from now. What is the most that this contract would be worth today if: 1. The rate of interest is 7 ...

1 suppose that the total benefit and total cost from a

1. Suppose that the total benefit and total cost from a continuous activity are, respectively, given by the following equations: B(Q) = 100 + 36Q - 4Q2 and C(Q) = 80 + 12Q. [Note: MB(Q) = 36 - 8Q and MC(Q) = 12.] a. Writ ...

During the winter ofnbsp2008-2009 the average utility bill

During the winter of? 2008-2009, the average utility bill for residents of a certain state was ?$173 per month. A random sample of 30 customers was selected during the winter of? 2009-2010, and the average bill was found ...

A mixture of three water samples will test positive for a

A mixture of three water samples will test positive for a contaminant if at least one of the samples contains it. If the contaminant is present in 7% of samples, find the probability that: 1. The mixture tests positive: ...

The average or par score for an 18 hole golf course is

The average, or "par" score for an 18 hole golf course is 72. The score is computed by counting the number of swings, or "strokes" a player must make with their club to hit the ball into each of the 18 holes on the golf ...

Your normally distributed population has a mean of 55 and a

Your normally distributed population has a mean of 55 and a standard deviation of 6. 95% of individual scores will fall between what 2 values? What percent of scores fall below 49?

Arrows theorem that states there is no true fair method for

Arrow's Theorem that states there is no true fair method for voting. Do you agree or disagree with this statement? Why?

The increase in prescription drugs cost increases the drug

The increase in prescription drugs cost, increases the drug companies profit. Should there be restrictions to lower consumer cost and how much of their profit should be reinvested into research and development?

4,153,160 Questions Asked
13,132 Experts
2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Recent Questions

Ask Business Economics Expert