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A firm is evaluating an extra dividend versus a share repurchase. In either case, $25,000 would be spent. Current earnings are $5.40 per share, and

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A firm is evaluating an extra dividend versus a share repurchase. In either case, $25,000 would be spent. Current earnings are $5.40 per share, and the stock currently sells for $58 per share. There are 1,000 shares outstanding. Ignore taxes and other imperfections in your answer. Evaluate the two alternatives in terms of the effect on the following: 1. price per share 2. EPS 3. P/E ratio 4. shareholder wealth

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