Corporate Finance: The Core, Student Value Edition Plus Mylab Finance With Pearson Etext -- Access Card Package (4th Edition)
4th Edition
ISBN: 9780134426785
Author: Jonathan Berk, Peter DeMarzo
Publisher: PEARSON
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Question
Chapter 9, Problem 32P
a.
Summary Introduction
To determine: The change in stock price.
Introduction:
Stock price: The stock is the price of the single purchasable/saleable share. Basically a stock price is the highest amount that the person willing to pay for the share and lowest amount that can purchased.
b.
Summary Introduction
To find: Whether stock will be expected to sell after hearing announcement and make profit after hearing announcement.
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Students have asked these similar questions
Roybus, Inc., a manufacturer of flash memory, just reported that its main production facility in Taiwan was destroyed in a
fire. Although the plant was fully insured, the loss of production will decrease Roybus's free cash flow by $182 million at
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a. If Roybus has 30 million shares outstanding and a weighted average cost of capital of 12.3%, what change in
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b. Would you expect to be able to sell Roybus stock on hearing this announcement and make a profit? Explain.
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affected by the event.)
The change in price per share would be $
(Round to the nearest cent.)
Mm.2.
Roybus, Inc., a manufacturer of flash memory, just reported that its main production facility in Taiwan was destroyed in a fire. Although the plant was fully insured, the loss of production will decrease Roybus's free cash flow by $181 million at the end of this year and by $57 million at the end of next year.
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b. Would you expect to be able to sell Roybus stock on hearing this announcement and make a profit? Explain.
KMS corporation has assets of $650 million, $65 million of which are cash. It has debt of $216.7 million. If KMS repurchases $21.7 million of its stock:
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b. What will be its new leverage ratio?
a. What changes will occur on its balance sheet? (Select the best choice below.)
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The new leverage ratio after the repurchase is
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Chapter 9 Solutions
Corporate Finance: The Core, Student Value Edition Plus Mylab Finance With Pearson Etext -- Access Card Package (4th Edition)
Ch. 9.1 - How do you calculate the total return of a stock?Ch. 9.1 - Prob. 2CCCh. 9.2 - In what three ways can a firm increase its future...Ch. 9.2 - Under what circumstances can a firm increase its...Ch. 9.3 - How does the growth rate used in the total payout...Ch. 9.3 - Prob. 2CCCh. 9.3 - Prob. 3CCCh. 9.4 - Prob. 1CCCh. 9.4 - What implicit assumptions are made when valuing a...Ch. 9.5 - State the efficient market hypothesis.
Ch. 9.5 - Prob. 2CCCh. 9 - Assume Evco, Inc., has a current price of 50 and...Ch. 9 - Anle corporation has a current price of 20, is...Ch. 9 - Suppose Acap Corporation will pay a dividend of...Ch. 9 - Prob. 4PCh. 9 - NoGrowth Corporation currently pays a dividend of...Ch. 9 - Summit Systems will pay a dividend of 1.50 this...Ch. 9 - Prob. 7PCh. 9 - Canadian-based mining company EI Dorado Gold (EGO)...Ch. 9 - In 2006 and 2007, Kenneth Cole Productions (KCP)...Ch. 9 - DFB, Inc., expects earnings at the end of this...Ch. 9 - Cooperton Mining just announced it will cut its...Ch. 9 - Procter and Gamble (PG) paid an annual dividend of...Ch. 9 - Colgate-Palmolive Company has just paid an annual...Ch. 9 - Prob. 14PCh. 9 - Halliford Corporation expects to have earnings...Ch. 9 - Prob. 16PCh. 9 - Maynard Steel plans to pay a dividend of 3 this...Ch. 9 - Prob. 18PCh. 9 - Prob. 19PCh. 9 - Prob. 20PCh. 9 - Prob. 23PCh. 9 - Prob. 24PCh. 9 - Prob. 25PCh. 9 - Suppose that In January 2006, Kenneth Cole...Ch. 9 - In addition to footwear, Kenneth Cole Productions...Ch. 9 - You read in the paper that Summit Systems from...Ch. 9 - Prob. 31PCh. 9 - Prob. 32PCh. 9 - Prob. 33P
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