Taggart Transcontinental and Phoenix-Durango Have Entered into a Stock Swap

Multiple Choice

Taggart Transcontinental and Phoenix-Durango have entered into a stock swap merger agreement whereby Taggart will pay a 30% premium over Phoenix-Durango's premerger price.If Taggart's premerger price per share was $15 and Phoenix-Durango's was $30,then the exchange ratio that Taggart will offer is closest to:

A) 0.4:1.
B) 1.8:1.
C) 2.0:1.
D) 2.6:1.