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5. Use the information for the question(s) below. Luther is a successful logistical services firm that currently has $5 billion in cash. Luther has decided
5. Use the information for the question(s) below. Luther is a successful logistical services firm that currently has $5 billion in cash. Luther has decided to use this cash to repurchase shares from its investors and has already announced the stock repurchase plan. Currently Luther is an all-equity firm with 1.25 billion shares outstanding. Luther's shares are currently trading at $20 per share. With perfect capital markets, what is the market value of Luther's equity after the share repurchase? A. $5 billion B. $25 billion C. $15 billion D. $20 billion O E. $10 billion 6. Use the information for the question(s) below. Luther is a successful logistical services firm that currently has $5 billion in cash. Luther has decided to use this cash to repurchase shares from its investors and has already announced the stock repurchase plan. Currently Luther is an all-equity firm with 1.25 billion shares outstanding. Luther's shares are currently trading at $20 per share. With perfect capital markets, what is the market price per share of Luther's stock after the share repurchase? A. $24 B. $20 C. $25 D. $18 O E. $15
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