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Consider the following premerger information about a biddingfirm (Firm B) and a target firm (Firm T). Assume that both firmshave no debt outstanding. Firm B Firm T Shares outstanding 5,6002,200 Price per share $ 45 $ 19 Firm B has estimated that the valueof the synergistic benefits from acquiring Firm T is $9,300. a. IfFirm T is willing to be acquired for $21 per share in cash, what isthe NPV of the merger? b. What will the price per share of themerged firm be assuming the conditions in (a)? (Do not roundintermediate calculations and round your answer to 2 decimalplaces, e.g., 32.16.) c. If Firm T is willing to be acquired for$21 per share in cash, what is the merger premium? d. Suppose FirmT is agreeable to a merger by an exchange of stock. If B offers oneof its shares for every two of T's shares, what will the price pershare of the merged firm be? (Do not round intermediatecalculations and round your answer to 2 decimal places, e.g.,32.16.) e. What is the NPV of the merger assuming the conditions in(d)? (Do not round intermediate calculations and round your answerto 2 decimal places, e.g., 32.16.)
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