Coca-Cola recently had a market value of equity of $200 billion with 4 billion shares outstanding. The book value of its equity is $20 billion.

a. What is Coca-Cola’s stock price per share? What is its book value per share?

b. If the company repurchases 100 million shares in the stock market at their current price, how will this affect the book value of equity if all else remains the same?

c. If there are no taxes or transaction costs, and investors do not change their perceptions of the firm, what should the market value of the firm be after the repurchase?

d. Instead of a share repurchase, the company decides to raise money by selling an additional 100 million shares on the market. If it can issue these additional shares at the current market price, how will this affect the book value of equity if all else remains the same?

e. If there are no taxes or transaction costs, and investors do not change their perception of the firm, what should the market value of the firm be after this stock issuance? What would its price per share be?