The current share price of a company is $25. The company has 1M shares  outstanding. The total value of debt is $10M. The company announced that it is going to repurchase $100,000 worth of stock. What will the price of the stock be after the repurchase? Assume M&M assumptions hold.

a.$30

b.$22.5

c.$25

d.$27.5

e.$20

Answer rating: 100% (QA)

Current value of equity 25 1000000 25000000 Equity repurchased 25 100000 2500000 ... View the full answer