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Given the following case, answer questions 6 and 8 below: Houston Inc. currently has 2.500 shares outstanding each sold for $75, whereas, Teta Co. bas 2,000 shares cutstanding each sold for 550. The earnings per share for Houston Inc. and Tetra Co. is S13 per share. Houston Inc. decides to acquire Tetra Co. by offering two new shares of Houston Inc. for every four shares of Tetra Co. Assume that the merger increases the value of the combined firms by $200,000 6. What is the Earning Per Share for Houston Inc. after merger? * O $13 per share $15.85 per share O $16.71 per share $14.23 per share None of the above 7. What is the price earnings ratio of Houston Inc. after the merger?* 0 4.91 0 3.73 4.58 O 5.89 8. What is the cost of the merger (approximately)?* Zero $39,285 $42,890 $45,960 None of the above Given the following case, answer questions 9 to 13 below: Car & Co is a German automobile corporation specialised in producing sports cars. In 2016, it has acquired Tiry Co., an English tire company. The acquisition costed $842 million and it was made for cash. It has resulted in S450 million cost reduction per year, Assume that the values of both Car & Co. and Tiry Co. before acquisition were $19.5 billion and $6.8 billion respectively and that the opportunity cost of capital is 125 9. What is the type of this combination?* Horizontal Vertical Conglomerate Cross-boarder merger None of the above 10. What is the gain from this acquisition? $5.458 billion $25.458 billion $3.750 billion $10.857 billion None of the above 11. How much cash money was paid by Car & Co. to Tiry Co.?* $7.642 billion $5.958 billion $6.280 billion $8.560 billion None of the above 12. If Car & Co. had paid $100 in cash for every share of Tiry Co., how many shares had Tiry Co., before the acquisition?* 61.250 million shares 76.420 million shares O 59.580 million shares 12. If Car & Co. had paid $100 in cash for every share of Tiry Co., how many shares had Tiry Co., before the acquisition?* 61.250 million shares 76.420 million shares O 59.580 million shares 49.870 million shares None of the above 13. What is the Net Present Value (NPV) of this acquisition? * $0.778 billion $17.816 billion O $2.462 billion O $2.908 billion O None of the above

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