Bo's Home Manufacturing has 290,000 shares outstanding that sell for $44.10 per share. The company has...

Bo's Home Manufacturing has 290,000 shares outstanding that sell for $44.10 per share. The company has announced that it will repurchase $49,000 of its stock. What will the share price be after the repurchase?

Expert Solution

Share price after repurchase	=	Market value after repurchase/Number of shares after repurchase
	=	$ 1,27,40,000	/	2,88,889
	=	$ 44.10

Working:

# 1	Market value before repurchase			290000*44.10	=	$ 1,27,89,000
	Less Shares repurchased					$ 49,000

	Market value after repurchase					$ 1,27,40,000

# 2	Number of shares before repurchased					2,90,000
	Less number of shares repurchased		49000/44.10		=	1,111

	Number of shares after repurchased					2,88,889

jeff jeffy answered 9 months ago

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