Q5: AMC Corporation currently has an enterprise value of $400 million and $100 million inexcess cash. The firm has 10 million shares outstanding and no debt. Suppose AMC uses itsexcess cash to repurchase shares. After the share repurchase, news will come out that willchange AMC’s enterprise value to either $600 million or $200 million.a. What is AMC’s share price prior to the share repurchase

Suppose a corporation currently has $500 Million of USDs in excess cash available to repurchase stock or pay dividends on its 20 million shares. Suppose the corporation decides to use the $500 Million to repurchase shares on the open market. If the current stock price is $50, what will be the price of the stock after the repurchase? Note: Express your answers in strictly numerical terms. For example, if the answer is $500, write enter 500 as an answer."

A firm has a market value equal to its book value. Currently, the firm has excess cash of $2,600 and other assets of $5,000. Equity is worth $7,600. The firm has 950 shares of stock outstanding and net income of $1,150. The firm has decided to spend all of its excess cash on a share repurchase program. How many shares of stock will be outstanding after the stock repurchase is completed?

Bo's Home Manufacturing has 470,000 shares outstanding that sell for $48.24 per share. The company has announced that it will repurchase $67,000 of its stock. What will the share price be after the repurchase?Multiple Choice$48.10$42.09$48.38$45.23$48.24Correct PrevQuestion 9 of 10 Total9 of 10Visit question mapNext

To illustrate, assume the acquiring company purchases all of the stock of the investee for a purchase price of $1,100 (instead of $800, as in the previous example), with a cash payment of $600 and issu- ance of 100 shares of $1 par value common stock with a fair value of $500 ($5 per share). Assume the investor is willing to pay the increased purchase price because the building, reported on the investee’s balance sheet at a net book value (cost less accumulated depreciation) of $600, has a current fair value of $900. The purchase price of $1,100, then, is comprised of two conceptual components: the book value of the Stockholders’ Equity of the investee company plus the portion of the building’s value not reported on the investee’s balance sheet:

Cash100,000Debt60,000Tax Rate10%Discount Rate6%Enterprise Value500,000Perpetual Growth Rate4%Given the data in the above table, calculate market capitalization of this hypothetical company. $540,000$460,000$100,000$400,000