1. BigBy and McCheese are all-equity firms. BigBy has 10,000 shares outstanding at a market price of $45 a share while McCheese has 5,000 shares outstanding at a price of $32 a share. BigBy is acquiring McCheese for $167,000 in cash. The incremental value of the acquisition is $12,500. What is the net present value of acquiring McCheese to BigBy?
$7,400
$8,100
$5,500
$6,600
$6,300
2. Pratt and Dansville are all-equity firms. Pratt has 4,000 shares outstanding at a market price of $60 a share. Dansville has 3,500 shares outstanding at a price of $36 a share. Pratt is acquiring Dansville for $132,000 in cash. The synergy of the acquisition is $10,000. What is the value of Dansville to Pratt?
$143,000
$136,000
$151,000
$147,000
$125,000