Fed Inc. has currently reported a value of operations of $550 million. Fed Inc. has 8 million shares outstanding. Also, it has $54 million, $85 million and $32 million of preferred stocks, debt, and short-term investments respectively. The firm plans to use its short-term investments to repurchase some of its common stocks. Assume that the firm has no other non-operating assets. What is the intrinsic stock price immediately before and immediately after the repurchase? *

4 points

a. Immediately before the repurchase, the intrinsic value of equity is $433 million, however, immediately after the repurchase, it is equal to $465 million.

b. Immediately before the repurchase, the intrinsic value of equity is $379 million, however, immediately after the repurchase, it is equal to $411 million.

c. Immediately before the repurchase, the intrinsic value of equity is $443million, however, immediately after the repurchase, it is equal to $411 million.

d. Immediately before the repurchase, the intrinsic value of equity is $411 million, however, immediately after the repurchase, it is equal to $465 million.

e. None of the above