Question
Suppose a company suddenly announces that it will do a project and smart investors (ie., like you) think this project has an NPV of -$50
Suppose a company suddenly announces that it will do a project and smart investors (ie., like you) think this project has an NPV of -$50 million. If this company's stock price prior to the announcement was $12 and the company has 20 million outstanding shares and existing debt of $100 million, what will be the company's stock price after this project is announced? Your answer should be rounded to one decimal place.
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Corporate Finance Core Principles and Applications
Authors: Stephen Ross, Randolph Westerfield, Jeffrey Jaffe, Bradford
3rd edition
978-0077971304, 77971302, 978-0073530680, 73530689, 978-0071221160, 71221166, 978-0077905200
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