O 1 75%AT&T LTE11:52 AMExit21Diagonal3.A rights offering that gives existing targetshareholders the right to buy shares ineither the target or the acquirer at a deeplydiscounted price once certain conditionsare met is called a:Poison pillWhite knightGolden parachuteClassified board4.Conglomerate Inc. is trading at $80/share,

From the four options we need to select the option corresponding to the statement given.The…

Answered: O 1 75% AT&T LTE 11:52 AM Exit 21…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Question 4Company X is a listed company and has become the target of a hostile takeover. The company currently trades at a price of q pounds per share. However, it is estimated that, if the takeover were successful, the value of a share would jump to v>q. Assume that X has dispersed ownership and that the stake of each individual shareholder is negligible. Assume also that the public offer is binding only if the bidder obtains at least 50% of outstanding shares and that, in this case, the bidder has to pay a small transaction cost c>0.a. Determine the maximum share price that the bidder is willing to offer to the shareholders.b. Given your answer in a., do you expect the takeover to succeed? Please give reasons for your answer.c. Assume now that, when acquiring the company, the bidder obtains a private benefit h>c. Do you expect the takeover to succeed in this case? Can you provide an economic interpretation for h?
Question 5 How much will an investor pay for a preferred stock that pays a $1,50 per share dividend if the investor requires a 11.5% return? O $13.04 O $1.35 O $1.67 O $14.54 O None of the listed items is correct L» A Moving to another question will save this response. MacBook Air 77 888 esc F3 F4 F5 F2 # $ % 3 4
A22
QUESTION 13 LEIC plc plans to acquire PEAR Plc. The timeline is as follows. Day 1- Market values for shares are LEIC Plc £12, PEAR Plc £99. Day 4 - At a private meeting, the board of LEIC Plc decides to make a bid for PEAR plc at £106 per share (to try and avoid resistance). Day 8 – LEIC plc publicly announces their offer of £106 per share on all shares. Details of the operational savings are not announced and remain confidential. What are the share prices of LEIC and PEAR on Day 8 if the market is semi-strong-form efficient? A. LEIC £12 and PEAR £99 OB. LEIC £12 and PEAR £106 C. LEIC greater than £12 and PEAR £106 D. LEIC less than £12 and PEAR £106
What are some ways in which the capital structure decisions canaffect the value of operations?
Question 3 On 6 July 2021, Falta Limited paid $300 to purchase a put option on Zebra Limited when the market price per ordinary shares was $120. The option gives Falta Limited to sell 500 shares at an exercise price of $120 and the option expires on 1 February 2022. Market price per share $ Time value of put Option $ Date 30 September 2021 31 December 2021 123 180 115 100 1 February 2022 112 30 Required: Prepare the journal entries for Falta for the following dates: (a) On 6 July 2021 to record the investment in the put option. (b) On 30 September 2021 when Falta Limited prepared the financial statements. (c) On 31 December 2021 when Falta Limited prepared the financial statements. (d) On 1 February 2022 when Falta Limited settled the call option.
A. B. Question 2 Given the order book for ABC Limited, Orders to buy Price 2.00 1.95 1.90 Quantity 10000 5000 5000 Orders to sell Price Quantity 2.10 2000 2.15 20000 2.20 10000 Required With the order book above, suppose a market order arrives to buy 3,000 shares, Al. At what price will the trade occur? A2. What is the cost of the 3,000 shares to the trader? A3. What will the new limit order book look like after the transaction is completed? A4. If the investor sells this 3,000 shares at the price of $2.3 per share one month later, what is the discrete holding period return for investing in this share? With the order book above, suppose a limit order arrives to buy 1000 shares at $2.05, B1. At what price will the trade occur? B2. what will the new limit order book look like after this transaction?
Bha
@ 1 75% AT&T LTE 11:52 AM 48 Exit Rearden Metal Company has earnings per share of $2. It has 10 million shares outstanding and is trading at $20 per share. Rearden is thinking of buying Associated Steel, which has earnings per share of $1.25, 4 million shares outstanding, and a price per share of $15. There are no expected synergies from the transaction. Rearden will pay for Associated Steel by issuing new shares, and the exchange ratio will be such that, at current pre- announcement share prices for both firms, the offer represents a 20% premium to buy Associated Steel. How many new shares will Rearden have to issue? 3.6 million 8.3 million 1.2 million 4.9 million
Given only the information provided, which bond would you suspect of having the lowest duration? Coupon Current Price Remaining Term Bond A 5% $ 703.11 20 years Bond B 7% $ 932.05 10 years Bond C 11% $ 1,078.63 3 years Bond D 11% $ 1,296.89 20 years Question 18 options: Bond A Bond B Bond C Bond D
just question 25 only
A5 3b QRS N-Queries Company has an exciting new project that will cost $10,000,000. The company proposes to finance this project by issuing new shares with a rights offering. Currently, the company has 2,000,000 shares outstanding, each valued in the financial market at $30. With the rights offering, shareholders will be able to purchase one new share for a subscription price of $10. b. How many new shares will be issued?

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