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Explain how a repurchase changes the number of shares but notthe stock price.A firm’s most recent FREE CASH FLOW (FCF) was $2.4 million, andits FCF is expected to grow at a constant rate of 5%. The firm’sWEIGHTED AVERAGE COST OF CAPITAL (WACC) is 14%, and it has 2million shares outstanding. The firm has $12 million in short-terminvestments that it plans to liquidate and then distribute in astock repurchase; the firm has no other financial investments ordebt.What is the value of operations?Immediately prior to the repurchase, what are the intrinsicvalue of equity and the intrinsic stock price?How many shares will be repurchased? How many shares willremain after the repurchase?Immediately after the repurchase, what are the intrinsic valueof equity and the intrinsic stock price