B (the bidding company) has 20 million shares and a net income of $40 million and T (the target company) has 10 million shares and a net income of $10 million. Operating synergies are expected to increase net income by $5 million per year B has decided to finance the acquisition with stock. If neither set of shareholders would find a reduction in EPS (upon acquisition) acceptable, the two limits on the exchange ratio are ____:1 and ____:1.

a. 0.75, 3.50

b. 0.35, 0.44

c, 6.44, 1.14

d. 0.44, 0.75