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-Which of the Following Would Be True Concerning the EPS

Question 78

Multiple Choice

 Alpha  Beta Total earnings$1,000,000$600,000Number of shares outstanding400,000200,000Earnings per share$2.50$3.00Price/earnings12X10X Market price/share $30.00$30.00\begin{array} { r r } &\underline{\text { Alpha }} &\underline{ \text { Beta }} \\\text {Total earnings}& \$ 1,000,000 & \$ 600,000 \\ \text {Number of shares outstanding}&400,000 & 200,000 \\ \text {Earnings per share}&\$ 2.50 & \$ 3.00 \\ \text {Price/earnings}&12 \mathrm { X } & 10 \mathrm { X } \\\text { Market price/share } & \$ 30.00 & \$ 30.00 \end{array}
-Which of the following would be true concerning the EPS of Alpha Corp.in 5 years? Alpha's EPS would be:


A) higher due to the merger.
B) the same with or without the merger.
C) lower without the merger.
D) lower with the merger.

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