ESSENTIALS CORPORATE FINANCE + CNCT A.
ESSENTIALS CORPORATE FINANCE + CNCT A.
9th Edition
ISBN: 9781259968723
Author: Ross
Publisher: MCG CUSTOM
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Chapter 14, Problem 14.3C
Summary Introduction

To discuss: The purchase technique used while the firm authorizes a trustee to purchase shares as they become available.

Introduction:

Repurchases is also termed as buy back of shares. This refers that the company buys back its outstanding shares, which reduces the number of its shares on the open market.

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General Finance
Assume an investor buys a share of stock for $18 at t = 0 and at the end of the next year (t = 1) , he buys 12 shares with a unit price of $9 per share. At the end of Year 2 (t = 2) , the investor sells all shares for $40 per share. At the end of each year in the holding period, the stock paid a $5.00 per share dividend. What is the annual time-weighted rate of return?
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