Consider the following scenario. This is not factual. This is a scenario. American Airlines is considering purchasing Sun Country Airlines. Sun Country has indicated they are willing to sell the organization for a discounted premium amount. After months of discussion, the discounted premium amount has ranged from eight to twenty-two percent. Two weeks ago, American Airlines agreed to purchase Sun Country Airlines for the discounted premium amount of twelve percent. Currently, Sun Country Airline’s stock price is $14, and they have 12,200,000 shares of outstanding stock.
Based on the data provided, what is the amount American will buy Sun Country for? Show the
Calculations.
Sample Solution