DEF stockholders are paid the current market value of their firm in the form of ABC stock. Both firms are 100% equity-financed. The total earnings of the combined firm are $77,000. What are the earnings per share after the merger?
A) $2.48
B) $2.53
C) $2.60
D) $2.98
E) $3.27

Question

DEF stockholders are paid the current market value of their firm in the form of ABC stock. Both firms are 100% equity-financed. The total earnings of the combined firm are $77,000.  What are the earnings per share after the merger?
A) $2.48 
B) $2.53 
C) $2.60 
D) $2.98 
E) $3.27

Quizplus · Accepted Answer

The Answer of DEF stockholders are paid the current market value of their firm in the form of ABC stock. Both firms are 100% equity-financed. The total earnings of the combined firm are $77,000.  What are the earnings per share after the merger?
A) $2.48 
B) $2.53 
C) $2.60 
D) $2.98 
E) $3.27

DEF Stockholders Are Paid the Current Market Value of Their