Firm A is negotiating a merger with Firm B. It agrees that all synergy gain would go to firm B's shareholders. Based on the following data, what is the stock exchange ratio; that is, how many B shares would one A share exchange for? Firm A: Market value of debt: $3 million Market value of equity: $7 million Number of shares: 0.1 million Estimated total firm value based on value-based management model if the merger takes place: 13 million Firm B: Market value of debt: $4 million Market value of equity: $6 million Number of shares: 0.4 million Estimated total firm value based on value-based management model if the merger takes place: 12 million

A. 2.92

B. 2.55

C. .2331

D. 2.10

Firm A is negotiating a merger with Firm B. It agress that all symergy gain wotid go to firm B's sharcholders, Based on the following data, what is the stock exchange ratio; that is, how many B shares would one A share exchange for? Firm A: Market value of debt: $3 million Market value of equity: $7 million Number of shares: 0.1 million Estimated total firm value based on value-based management model if the merger takes place: 13 million Firm B: Market value of debt: $4 million Market value of equity: $6 million Number of shares: 0.4 million Fctimated total firm value haced on value-haced manacement model if the merner takes Firm A is negotiating a merger with Firm B. It agress that all symergy gain wotid go to firm B's sharcholders, Based on the following data, what is the stock exchange ratio; that is, how many B shares would one A share exchange for? Firm A: Market value of debt: $3 million Market value of equity: $7 million Number of shares: 0.1 million Estimated total firm value based on value-based management model if the merger takes place: 13 million Firm B: Market value of debt: $4 million Market value of equity: $6 million Number of shares: 0.4 million Fctimated total firm value haced on value-haced manacement model if the merner takes