Use the Information for the Question(s)below

question 52

Multiple Choice

Use the information for the question(s) below.
Luther Industries has no debt,a total equity capitalization of $20 billion,and a beta of 1.8.Included in Luther's assets are $4 billion in cash and risk-free securities.
-What is Luther's enterprise value?

• A)$16 billion
• B)$10.5 billion
• C)$24 billion
• D)$20 billion

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Definitions:

Familiarity Hypothesis

A theory suggesting that people prefer things they are familiar with over those that are unfamiliar.

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Identical copies of an image or object, but reversed left to right, as if viewed in a mirror.

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A socio-psychological phenomenon whereby a person is less likely to take responsibility for action or inaction when others are present.

Bystander Intervention

The act of someone stepping in to help or intervene when they see another person in trouble, influenced by various psychological and situational factors.