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Q5 (20 marks) .20 Number of shares outstanding 100,000 Book value $400,000 Market value $800,000 Net income $80,000 Return on equity Price earnings ratio 10

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Q5 (20 marks) .20 Number of shares outstanding 100,000 Book value $400,000 Market value $800,000 Net income $80,000 Return on equity Price earnings ratio 10 Earnings per share $.80 Net Present Value $100,000 Equipment cost $250,000 1) What will be the stock price of the company after the project is readily executed? 2) Evaluate the impact on the wealth of the shareholders after the project

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