Business, 24.04.2020 21:57 sakshimehta
Natsam Corporation has $ 250 million of excess cash. The firm has no debt and 500 million shares outstanding with a current market price of $ 15 per share. Natsam's board has decided to pay out this cash as a one-time dividend. a. What is the ex-dividend price of a share in a perfect capital market? b. If the board instead decided to use the cash to do a one-time share repurchase, in a perfect capital market what is the price of the shares once the repurchase is complete? c. In a perfect capital market, which policy, in part (a) or (b), makes investors in the firm better off?
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Natsam Corporation has $ 250 million of excess cash. The firm has no debt and 500 million shares out...
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