Question: Consider the following premerger information about a bidding firm (Firm B) and a target firm (Firm T). Assume that both firms have no debt outstanding

 Consider the following premerger information about a bidding firm (Firm B)
and a target firm (Firm T). Assume that both firms have no

Consider the following premerger information about a bidding firm (Firm B) and a target firm (Firm T). Assume that both firms have no debt outstanding Shares outstanding Price per share Fire B Fire T 4,600 1,600 $40 $14 Firm B has estimated that the value of the synerlyistic benefits from acquiring Firm T is $8,800. a. If Firm Tis willing to be acquired for $16 per share in cash, what is the NPV of the merger? (Do not round intermediate calculations.) NPV b. What will the price per share of the merged firm be assuming the conditions in (a)? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g. 32.16.) Share price c. If Firm T is willing to be acquired for $16 per share in cash, what is the merger premium? (Do not round intermediate calculations.) Merger premium calculations.) NPV $ b. What will the price per share of the merged firm be assuming the conditions in (a)? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g. 32.16.) Share price c. If Firm T is willing to be acquired for $16 per share in cash, what is the merger premium? (Do not round intermediate calculations.) Merger premium d. Suppose Firm Tis agreeable to a merger by an exchange of stock. If B offers one of its shares for every two of T's shares what will the price per share of the merged firm be? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g.. 32.16.) Price per share e. What is the NPV of the merger assuming the conditions in (d)? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) NPV $

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