Multiple Choice
The Greenbriar is an all-equity firm with a total market value of $520,000 and 20,000 shares of stock outstanding.Management is considering issuing $120,000 of debt at an interest rate of 10 percent and using the proceeds on a stock repurchase.Ignore taxes.How many shares will the firm repurchase if it issues the debt securities?
A) 2,871 shares
B) 3,516 shares
C) 4,521 shares
D) 4,607 shares
E) 4,615 shares
Correct Answer:
Verified
Correct Answer:
Verified
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