a. Firm B Ltd is a company that specialises in online ordering and delivery of gift baskets. The firms CFO is currently considering a transaction to repurchase shares using excess cash of $800,000. The value of the firms other assets is $5,200,000. The firm has 600,000 shares outstanding and the total value of equity is worth $6,000,000. Assume the book value of assets equals the market value. The firm has a net income of $700,000. If the firm spends all of its excess cash on a share repurchase program, how many shares of stock will be outstanding after the stock repurchase is completed? b. Consider the situation of Firm B Ltd in part (a) above. What will the stock price per share be if the firm pays out its excess cash as a cash dividend? c. It has been shown that in the absence of taxes and other market imperfections firm value will be unaffected by dividend policy. Explain the logic behind this conclusion. Next, describe three real world factors that may cause one dividend policy to be preferable to another.