What % Age of Value Should Be Allocated to Equity

question 82

Multiple Choice

What % age of value should be allocated to equity in WACC computations for a firm with $50 million in debt selling at 85% of par, $50 million in book value of equity, and $65 million in market value of equity?

• A)50.0%
• B)54.1%
• C)56.5%
• D)60.5%

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Definitions:

Spinal Nerves

Nerves that emerge from the spinal cord to transmit motor, sensory, and autonomic signals between the spinal cord and the body.

Lumbar

The lumbar region is the lower part of the spine consisting of five vertebrae, known for bearing much of the body's weight and for being a common site of back pain.

Sacral

Pertaining to the sacrum, the triangular bone at the base of the spinal column formed from fused vertebrae.

Nerve Plexus

A network of intersecting nerves providing sensory and motor control to various body parts, such as the brachial plexus which controls the arm.