A Company Has a Share Price of $24

question 38

Multiple Choice

A company has a share price of $24.50 and 118 million shares outstanding.Its market-to-book ratio is 4.2,its book debt-equity ratio is 3.2,and it has cash of $800 million.How much would it cost to take over this business assuming you pay its enterprise value?

• A)$1.5 billion
• B)$2.8 billion
• C)$3.6 billion
• D)$4.3 billion
• E)$2.9 billion

---

Definitions:

Physiological Components

The biological parts and processes that make up the physical aspects of a living organism, including tissues, organs, and systems.

Hunger

A physical sensation or condition resulting from a lack of food, leading to a desire to eat.

Maslow's Hierarchy

A theory in psychology proposed by Abraham Maslow, suggesting that individuals are motivated by a hierarchy of needs ranging from basic physiological needs to self-actualization.

Pyramid

A geometric structure with a square or triangular base and triangular sides that converge to a point at the top.