FUND.OF CORP.FINANCE PKG. F/BU >C<
FUND.OF CORP.FINANCE PKG. F/BU >C<
16th Edition
ISBN: 9781323165997
Author: Berk
Publisher: PEARSON C
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Chapter 17, Problem 21P

FCF Co. has 20,000 shares outstanding and a total market value of $1 million, $300 thousand of which is debt and the other $700 thousand is equity. It is planning a 10% stock dividend.

a. What is the stock price before the dividend and what will it be after the dividend?
b. If an investor owns 1000 shares before the dividend, what will be the total value of her investment in FCF before and after the dividend?

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