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XYZ Has a Market Value of $287,400

Question 9

Multiple Choice

XYZ has a market value of $287,400.ABC has a market value of $611,900.ABC believes it can create $57,000 of synergy if it acquires XYZ for $300,000 in cash.What is the value of ABC following the merger? Assume both firms are all-equity financed.


A) $656,300
B) $998,900
C) $956,300
D) $668,900
E) $368,900

Correct Answer:

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