Use the Information for the Question(s)below

question 80

Multiple Choice

Use the information for the question(s) below.
Suppose that Texas Trucking (TT) has earnings per share of $3.45 and EBITDA of $45 million.TT also has 5 million shares outstanding and debt of $150 million (net of cash) .You believe that Oklahoma Logistics and Transport (OLT) is comparable to TT in terms of its underlying business,but OLT has no debt.OLT has a P/E of 12.5 and an enterprise value to EBITDA multiple of 7.
-Based upon the enterprise value to EBITDA ratio,the value of a share of Texas Trucking is closest to:

• A)$33.00.
• B)$82.50.
• C)$43.10.
• D)$21.25.

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Definitions:

Tricyclic Antidepressant Agents

A class of medications used to treat depression and certain other conditions by altering the balance of neurotransmitters in the brain.

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A class of medications used to treat certain psychiatric conditions by inhibiting the action of the enzyme monoamine oxidase, affecting brain chemistry.

Cognitive Restructuring

A psychotherapeutic process of learning to identify and dispute irrational or maladaptive thoughts, often used in cognitive behavioral therapy.

Desensitization

A psychological process that reduces the emotional responsiveness to a negative, arousing, or positive stimulus after repeated exposure to it.