Neither acquiring ﬁrm A nor target ﬁrm B has any debt. The incremental value of the proposed acquisition is estimated to be $250,000. Firm B is willing to be acquired for $30 per share in cash. What is the NPV for acquiring ﬁrm B?
A) The NPV is negative
B) $115,000
C) $160,000
D) $235,000
E) $260,000

Question

Neither acquiring ﬁrm A nor target ﬁrm B has any debt. The incremental value of the proposed acquisition is estimated to be $250,000. Firm B is willing to be acquired for $30 per share in cash.  What is the NPV for acquiring ﬁrm B?
A) The NPV is negative 
B) $115,000 
C) $160,000 
D) $235,000 
E) $260,000

Quizplus · Accepted Answer

The Answer of Neither acquiring ﬁrm A nor target ﬁrm B has any debt. The incremental value of the proposed acquisition is estimated to be $250,000. Firm B is willing to be acquired for $30 per share in cash.  What is the NPV for acquiring ﬁrm B?
A) The NPV is negative 
B) $115,000 
C) $160,000 
D) $235,000 
E) $260,000

Neither Acquiring ﬁRm a nor Target ﬁRm B Has Any