Multiple Choice
Use the information for the question(s) below.
Luther is a successful logistical services firm that currently has $5 billion in cash. Luther has decided to use this cash to repurchase shares from its investors and has already announced the share repurchase plan. Currently, Luther is an all-equity firm with 1.25 billion shares outstanding. Luther's shares are currently trading at $20 per share.
-With perfect capital markets, what is the market value of Luther's equity after the share repurchase?
A) $25 billion
B) $20 billion
C) $10 billion
D) $15 billion
Correct Answer:
Verified
Correct Answer:
Verified
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