A ﬁrm has a market value equal to its book value.Currently, the ﬁrm has excess cash of £400 and other assets of £7,600.Equity is worth £8,000.The ﬁrm has 200 shares outstanding and net income
Of £900.The ﬁrm has decided to pay out all of its excess cash as a cash dividend.What will the
Earnings per share be after the dividend is paid?

Question

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The Answer of A ﬁrm has a market value equal to its book value.Currently, the ﬁrm has excess cash of £400 and other assets of £7,600.Equity is worth £8,000.The ﬁrm has 200 shares outstanding and net income
Of £900.The ﬁrm has decided to pay out all of its excess cash as a cash dividend.What will the
Earnings per share be after the dividend is paid?

A ﬁRm Has a Market Value Equal to Its Book