Use the Tables for the Question(s) Below

question 30

Multiple Choice

Use the tables for the question(s) below.

The following are financial ratios for three comparable companies:

-Based upon the average EV/EBITDA ratio of the comparable firms,if Ideko holds $6.5 million of cash in excess of its working capital needs,then Ideko's target market value of equity is closest to:

• A)$155 million.
• B)$157 million.
• C)$165 million.
• D)$193 million.

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Definitions:

Loan Repayment

The process of paying back borrowed money, typically in installments over a set term.

T-Bill

Short-term government debt security with a maturity of less than one year.

Simple Interest

A method of calculating interest where it is applied only to the principal amount, not on the accumulated interest.

Profit

The financial gain obtained when revenue from business activities exceeds the expenses, costs, and taxes involved in operating.