The Current Market Value of the Assets of Bigelow

question 24

Multiple Choice

The current market value of the assets of Bigelow.is €86 million, with a standard deviation of 15% per year.The firm has zero-coupon bonds outstanding with a total face value of €45 million.These
Bonds mature in 2 years.The risk-free rate is 4% per year compounded continuously.What is the
Value of d1?

• A)3.54
• B)3.62
• C)3.68
• D)3.71
• E)3.75

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