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Suppose you have the following information concerning an acquiring firm (A) and a target firm (B). Neither firm has any debt. The incremental value of

Suppose you have the following information concerning an acquiring firm (A) and a target firm (B). Neither firm has any debt. The incremental value of the acquisition is estimated to be $250,000. Firm B is willing to be acquired for $540,000 worth of Firm A's stock.

Firm A Firm B
Number of Shares 50,000 18,000
Price per Share $50.00 $22.50

What is the NPV of acquiring Firm B?

Select one:

A. $162,015

B. The NPV is negative

C. $102,120

D. $118,156

E. $94,588

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