Based on the Corporate Valuation Model, the Value of a Company's

question 7

Multiple Choice

Based on the corporate valuation model, the value of a company's operations is $1,200 million.The company's balance sheet shows $80 million in accounts receivable, $60 million in inventory, and $100 million in short-term investments that are unrelated to operations.The balance sheet also shows $90 million in accounts payable, $120 million in notes payable, $300 million in long-term debt, $50 million in preferred stock, $180 million in retained earnings, and $800 million in total common equity.If the company has 30 million shares of stock outstanding, what is the best estimate of the stock's price per share?

• A)$24.90
• B)$27.67
• C)$30.43
• D)$33.48
• E)$36.82

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Definitions:

Vocational Choice

The selection of a career or profession based on an individual's interests, skills, values, and the availability of opportunities in the job market.

External Locus Of Control

The belief that one's success or failure is due to external factors beyond their control.

Chance

Chance is the occurrence of events in the absence of any obvious intention or cause.

Fate

A predetermined course of events often considered to be beyond human control or influence.