Question
1) Bartow Industrial is reviewing a new proposal which will require $360,000 of new fixed assets. The net present value of the project is $84,000.
1)
Bartow Industrial is reviewing a new proposal which will require $360,000 of new fixed assets. The net present value of the project is $84,000. The price-earnings ratio of the project equals that of the existing firm. What will the new book value per share be after the project is implemented given the following current information on the firm?
| Number of Shares Outstanding | 50,000 |
| Book Value | $894,000 |
| Market Value | $1,072,000 |
| Net Income | $67,000 |
| Price Earnings Ratio | 16 |
| Earnings Per Share | $1.34 |
A. $16.22 B. $18.77 C. $22.47 D. $23.61 E. $25.08
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Handbook Of Key Global Financial Markets Institutions And Infrastructure
Authors: Gerard Caprio
1st Edition
0123978734, 9780123978738
