An analyst does research about earnings per share and gathers the following information about a company's planned share repurchase using borrowed funds:
Before-tax borrowing | 11% |
Marginal tax rate | 35% |
Price / Earnings ratio before share repurchase | 13 |
All else being equal, compared to earnings per share before the repurchase, earnings per share after the repurchase will most likely:()
A. decrease.
B. remain the same.
C. increase.