Solved: Shares outstanding and the expected return, Finance Basics

Shares outstanding and the expected return

Problem:

Microsoft has $35 billion in cash/money market securities earning 4% per year. Suppose the company announces that it will use $25 billion of that cash to repurchase stock. What effect will this have on the stock price? Assume the stock is selling for $52 per share. There are 4 billion shares outstanding and the expected return of the investors is 12%.

Please show work using Excel.

Solution Preview :

Prepared by a verified Expert

Finance Basics: Shares outstanding and the expected return

Reference No:- TGS02053508

Now Priced at $20 (50% Discount)

Recommended (96%)

Rated (4.8/5)

Have a Question? (oR Write a Review)

Write atleast 100 words!!

Asked Questions

What key finite resources that require conservation strategy

Two key finite resources that require conservation strategies are fossil fuels (like oil and gas) and rare earth minerals, and their depletion disproportionatel

Discussion about oral contraceptive for pregnancy prevention

A patient who takes oral contraceptives for pregnancy prevention has missed her last 2 pills. What should the NP advise the patient to do to minimize the risk

Problem regarding holistic integration of health

The prognosis for kidney stones will generally depend on the stone's size and location, the obstruction's presence, infection, and the patient's general health

Evaluating progress of an adolescent client with bulimia

Problem: The nurse is evaluating the progress of an adolescent client with bulimia who has been treated as an outpatient.

African-american male diagnosed with stage 1 hypertension

MH is a 46 year-old African-American male recently diagnosed with Stage 1 Hypertension during his last visit with his doctor.

Do you plan to manage the emotional intensity of crisis work

Do you plan to manage the emotional intensity of crisis work, and are there any particular challenges you anticipate when connecting clients

What if someone wanted to stop drinking sugary drinks

Pria told her friends she really wanted to stop drinking sugary drinks. She had been thinking about it and she was going to start next week.

Solution Preview :

Prepared by a verified Expert

Finance Basics: Shares outstanding and the expected return

Reference No:- TGS02053508

Have a Question? (oR Write a Review)

Recent Questions Asked Finance Basics

Q : Computing the price of the stock today

Q : Obtain a linear regression line for the data

Q : Compute the labor productivity and the multifactor

Q : Discuss about advanced calculus

Q : Shares outstanding and the expected return

Q : Japanese attack on pearl harbor

Q : Find the break-even quantity

Q : Firms dividend yield and dividend payout ratio per share

Q : Locate a new factory in northwestern united states