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antoniya [11.8K]
3 years ago
11

Suppose that the market price of Company A is $50 per share and that of Company B is $20. If A offers half a share of common sto

ck for each share of B, what is the percentage increase in wealth for B's shareholders?
A. -25%.
B. -20%.
C. -20%.
D. +25%.
Business
1 answer:
liubo4ka [24]3 years ago
3 0

Answer:

D) +25%.

Explanation:

If A offers 1/2 a share per 1 share of B, it means that the value of B's shares will increase from $20 to $25 (= $50 x 1/2). This $5 increase represents a 25% increase in wealth {= [($25 - $20) / $20] x 100}.

The price of the stock represents the wealth of the stockholders, since a stockholder that had 100 shares previously owned $2,000 in stocks, but as the price increases, the stockholder's wealth increases to $2,500.

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3 years ago
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Pat's Custom Tuxedo Shop maintains its records on the cash basis. During this past year Pat's collected $43,300 in tailoring fee
Luba_88 [7]

Answer:

net income = $31,500

Explanation:

given data

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to find out

accrual basis net income

solution

we get here net income by given expression that is

net income = tailoring fees - expenses paid + account receivable + supplies increased - liabilities increased - Depreciation expense .......1

put here value

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3 years ago
Crane Flight Services contributes $25 a week to Helen's retirement plan starting immediately. Assuming she works for Crane for a
Zigmanuir [339]

Answer:

The value of this employee benefit today is closest to $17,758.66

Explanation:

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