I will look at your profile and see if I can subscribe based on your content
Answer:
It can purchase at most, $18.13 per share.
Or 72.52 millions for the total 4,000,000 shares
Explanation:
We are given with the present value of the merger at Craftworks discount rate. The shares can be purchase at most at the same level of the present value of the increase in the free cash flow.
That way, the net present value will be zero and the merger will yield the 16% required.
72,520,000 Millions
4,000,000 shares outstanding
price per share 18.13
The crafworks shares can be purchase at most for 18.13 above this, it would yield the 16% required
Currently the share are at 16.25 so it could be possible to do the take-over
Answer:
By producing a product with a lower opportunity cost
Explanation:
Given that the law of comparative advantage states that a nation is better off when it produces goods and services for which it has a comparative advantage.
To obtain a comparative advantage means "By producing a product with a lower opportunity cost."
This implies that while many nations can produce the same products, a particular nation will have the comparative advantage over other nations if its opportunity cost of producing that specific product is quite lower compared to other nations that ks capable of producing the same product.
