Use the Table for the Question(s)below

question 33

Multiple Choice

Use the table for the question(s) below.
-The table above shows the share prices and multiples for a number of firms in the media industry. Another media firm (not shown) had sales of $620 million, EBITDA of $84 million, excess cash of $66 million, $14 million of debt, and 120 million shares outstanding. If the firm had an EPS of $0.48, what is the difference between the estimated share price of this firm if the average price-earnings ratio is used and the estimated share price if the average enterprise value/EBITDA ratio is used?

• A)$4.94
• B)$0.34
• C)$0.49
• D)$5.43

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Definitions:

Equitable Outcome

An equitable outcome is a situation or result in economic transactions or distributions that is considered fair or just among all parties involved.

Contract Curve

In economics, a line on an Edgeworth box diagram representing the set of optimal allocations between two parties.

Egalitarian View

A perspective advocating for equal rights, benefits, and opportunities for all members of society.

Equity

Equity refers to ownership interest in a company, often represented by stocks, providing a claim on the company's assets and earnings.