A Firm Has 41 Million Shares Outstanding with a Current

question 68

Multiple Choice

A firm has 41 million shares outstanding with a current share price of $4.30 The firm has a market-to-book ratio of 8.5 and a book debt-equity ratio of 2.2.If the firm currently has $18 million in cash,what is its enterprise value?

• A)$176 million
• B)$204 million
• C)$148 million
• D)$49 million
• E)$240 million

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Definitions:

Bundle

A group of products or services sold together as a single package, often offered at a discounted price compared to purchasing each item individually.

Base Year

The base year is a specific year against which economic or financial indices are measured, allowing for comparison across different periods by setting a standard reference point.

Frictional Unemployment

Unemployment that occurs when people are between jobs or are entering the workforce for the first time, typically a short-term condition.

Economy

A system of production, distribution, and consumption of goods and services among individuals, businesses, and governments within a certain geographical area.