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Big Industries has the following market value balance sheet. The stock currently sells for $20 a share, and there are 1,140 shares outstanding. The firm
Big Industries has the following market value balance sheet. The stock currently sells for $20 a share, and there are 1,140 shares outstanding. The firm will either pay a dividend of $1 per share or repurchase $1,140 worth of stock. Ignore taxes. Assets Cash Fixed assets Liabilities and Equity Debt $ 10,700 Equity 22,800 $ 4,800 28,700 a. What will be the subsequent price per share if the firm pays a dividend? Stock price per share b. What will be the subsequent price per share if the firm repurchases stock? (Round your answer to the nearest dollar.) Stock price per share c. If total earnings of the firm are $9,900 a year, find earnings per share if the firm pays a dividend. (Round your answer to 3 decimal places.) EPS d. Now find earnings per share if the firm repurchases stock. (Round your answer to 3 decimal places.) EPS
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