Go back to the first Rational Demiconductor balance sheet. Now assume that Rational wins a lawsuit and
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Go back to the first Rational Demiconductor balance sheet. Now assume that Rational wins a lawsuit and is paid $1 million in cash. Its market capitalization rises by that amount. It decides to pay out $2 per share instead of $1 per share. Explain what happens to Rational's stock price if
(a) The payout comes as a cash dividend
(b) As a share repurchase.
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Related Book For
Principles of Corporate Finance
ISBN: 978-1259144387
12th edition
Authors: Richard Brealey, Stewart Myers, Franklin Allen
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