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Firm a Is Planning on Merging with Firm B

Question 61

Multiple Choice

Firm A is planning on merging with Firm B. Firm A will pay Firm B's stockholders the current value of their stock in shares of Firm A. Firm A currently has 2,300 shares of stock outstanding at a market price of $20 a share. Firm B has 1,800 shares outstanding at a price of $15 a share. What is the value per share of the merged firm?


A) $19.00
B) $19.18
C) $19.44
D) $20.00
E) $20.33

Correct Answer:

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