Question: Stock Repurchase: Sterling Resources is evaluating an extra dividend versus a share repurchase. In either case, a total of $4,000 would be spent. Current earnings

Stock Repurchase: Sterling Resources is evaluating an extra dividend versus a share repurchase. In either case, a total of $4,000 would be spent. Current earnings are $2.10 per share, and the stock currently sells for $46 per share. There are 800 shares outstanding. Ignoring taxes and other imperfections, what would be shareholder wealth after the prospective repurchase? $46 per share per shareholder $41 per share per shareholder None of these values are correct. $48.10 per share per shareholder

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