Please elaborate where the highlighted area on the answer came from, thank you

4. Companies A and B are valued as follows: # of shares Earnings per share Share price A 2000 $10 $100 B 1000 $10 $50 Company A now acquires B by offering one (new) share of A for every two shares of B (that is, after the merger, there are 2500 shares of A outstanding). Suppose that the merger really does increase the value of the combined firms by $20,000. (i.e., PVAB - PVA - PVB = $20,000). What is the cost of the merger? A. zero B. $2,000 C. $8,000 D. $4,000 PVAB = 200,000 + 50,000 + 20,000 = 270,000; Price per share = 270,000/2,500 = 108; Cost = (108)(500) - 50,000 = 4,000