Rational Demiconductor has at this moment one million shares outstanding and the following market-value balance sheet: Rational
Fantastic news! We've Found the answer you've been seeking!
Question:
Rational Demiconductor has at this moment one million shares outstanding and the following market-value balance sheet:
| Rational Demiconductor Balance Sheet (Market Values, $ millions) | ||||
| Surplus cash | $ 1.0 | $ 0 | Debt | |
| Fixed assets and net working capital | 10.0 | 11.0 | Equity market capitalization (1 million shares at $11 per share) | |
| $11.0 | $11.0 | |||
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. |
| a. | What happens to Rational |
b. What happens to Rationale's stock price if the payout comes as a share repurchase? (Round your answer to the nearest whole number.)
New stock price
Expert Answer:
Related Book For 
Posted Date:
