The target investors of the new issuance of the 800,000 P1,000-par value shares expect a return of 14% and a zero growth rate. If the management quantifies this return as P160 per share, what should the target issue price per share be? * a. P1,142.96 b. P875.00
The target investors of the new issuance of the 800,000 P1,000-par value shares expect a return of 14% and a zero growth rate. If the management quantifies this return as P160 per share, what should the target issue price per share be? * a. P1,142.96 b. P875.00
Managerial Economics: A Problem Solving Approach
5th Edition
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Chapter5: Investment Decisions: Look Ahead And Reason Back
Section: Chapter Questions
Problem 5.2IP
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The target investors of the new issuance of the 800,000 P1,000-par value shares expect a return of 14% and a zero growth rate. If the management quantifies this return as P160 per share, what should the target issue price per share be? *
a. P1,142.96
b. P875.00
c. P1,400.00
d. P1,600.00
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