Question
The all-equity firm Metallica Corporation wants to diversify its operations. Some recent financial information for the company is shown here: Stock price $ 74 Number
| The all-equity firm Metallica Corporation wants to diversify its operations. Some recent financial information for the company is shown here: |
| Stock price | $ | 74 | |
| Number of shares | 30,000 | ||
| Total assets | $ | 9,800,000 | |
| Total liabilities | $ | 4,700,000 | |
| Net income | $ | 420,000 | |
| MHMM is considering an investment that has the same PE ratio as the firm. The cost of the investment is $640,000, and it will be financed with a new equity issue. The return on the investment will equal MHMMs current ROE
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Evolutionary Finance
Authors: Bartholomew Frederick Dowling
1st Edition
0230502199, 9780230502192
