Financial Alchemists (FA) has a market value equal to its book value. Currently, FA has cash on hand of $2400 and other assets of $8,500. Equity is worth $6,000. FA has 200 shares of stock outstanding and net income of $1200. How much greater will earnings per share be if FA uses its cash to repurchase some of its own stock?

$10.00

$6.00

EPS won't increase, it will decline

$4.00

$0.00