20.6. When a firm with an extremely high price/earnings ratio purchases a firm with a very low...

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20.6. When a firm with an extremely high price/earnings ratio purchases a firm with a very low price/

earnings ratio in an exchange of stock, its earnings per share will increase. Do you think firms are more likely to acquire other firms when it results in an increase in their earnings per share? Is it beneficial to shareholders to initiate a takeover for these reasons?

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Financial Markets And Corporate Strategy

ISBN: 9780071157612

2nd Edition

Authors: Mark Grinblatt, Sheridan Titman

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