NO.PZ201601200500005003
问题如下：
Based on Exhibit 1, if Yeta’s management implemented Proposal #3 at the current share price, earnings per share would:
选项：
A.decrease
remain unchanged
increase
解释：
C is correct. In the case of external funding, a company’s earnings per share will increase if the stock’s earnings yield, which is the ratio of earnings per share to share price, exceeds the after-tax cost of borrowing. Yeta’s earnings yield is 9.10% (= US$1.82/US$20.00), which exceeds the after-tax cost of borrowing of 8.50%.
A is incorrect because EPS will increase (not decrease) if the stock’s earnings yield (= US$1.82/US$20.00) exceeds the after-tax cost of borrowing. Yeta’s earnings yield of 9.10% exceeds the after-tax cost of borrowing of 8.50%.
B is incorrect because EPS will increase (not remain unchanged) if the stock’s earnings yield (= US$1.82/US$20.00) exceeds the after-tax cost of borrowing. Yeta’s earnings yield of 9.10% exceeds the after-tax cost of borrowing of 8.50%.
（100*1.82-40*8.5%）/（100-40/20）=1.8224 > 1.82 所以EPS after repurchase increase?
