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Consider the following premerger information about Firm A and Firm B: Consider the following premerger information about Firm A and Firm B: Total earnings Shares

Consider the following premerger information about Firm A and Firm B:

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Consider the following premerger information about Firm A and Firm B: Total earnings Shares outstanding Price per share Firm A Firm B $ 2,300 700 300 $41 45 1,100 Assume that Firm A acquires Firm B via an exchange of stock at a price of $47 for each share of B's stock. Both A and B have no debt outstanding a. What will the earnings per share (EPS) of Firm A be after the merger? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) EPS b. What will Firm A's price per share be after the merger if the market incorrectly analyzes this reported earnings growth (that is, the price-earnings ratio does not change)? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Price per share c. What will the price-earnings ratio of the postmerger firm be if the market correctly analyzes the transaction? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Price -earnings ratio times d-1 If there are no synergy gains, what will the share price of A be after the merger? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Price per share d-2 What will the price-earnings ratio be? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Price -earnings ratio times

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