a. What is the economic gain from the acquisition? b-1. What is the cost of the acquisition if Leisure Products pays $35 in cash for each share of Plastitoys?

b-2. What is the NPV to Leisure of acquiring Plastitoys?

c-1. What is the cost of the acquisition if Leisure Products offers 1 share of Leisure Products for every 1.6359 shares of Plastitoys?

c-2. What is the NPV to Leisure of acquiring Plastitoy?

As treasurer of Leisure Products, Inc., you are investigating the possible acquisition of Plastitoys. You have the following basic data: Plastitoys Forecast earnings per share Forecast dividend per share Number of shares Stock price Leisure Products $ 5 $ 3 600,000 $ 50 $ 3.20 $ 1.80 400,000 $ 26 You estimate that investors currently expect Plastitoys's earning and dividend to grow at a steady rate of 7% per year. You believe that Leisure Products could increase Plastitoys's growth rate to 10% per year, after 1 year, without any additional capital investment required. (Do not round your intermediate calculations. Round your answers to the nearest dollar. Use the minus sign to enter negative numbers if necessary. Enter your answers for costs as positive values.) As treasurer of Leisure Products, Inc., you are investigating the possible acquisition of Plastitoys. You have the following basic data: Plastitoys Forecast earnings per share Forecast dividend per share Number of shares Stock price Leisure Products $ 5 $ 3 600,000 $ 50 $ 3.20 $ 1.80 400,000 $ 26 You estimate that investors currently expect Plastitoys's earning and dividend to grow at a steady rate of 7% per year. You believe that Leisure Products could increase Plastitoys's growth rate to 10% per year, after 1 year, without any additional capital investment required. (Do not round your intermediate calculations. Round your answers to the nearest dollar. Use the minus sign to enter negative numbers if necessary. Enter your answers for costs as positive values.)